‘Soft’ Data Soars As Dallas Fed Manufacturers’ Uncertainty Plunged In May

Uncertainty – while mentioned a few times by respondents – plunged in May, according to the latest survey of Manufacturers by The Dallas Fed…

Source: Bloomberg

Across the board, almost everything improved (prices down is an ‘improvement’)…

Source: Bloomberg

Looking ahead, expectations for new orders and production surged higher while expectations for the tariff-induced hyperinflation hysteria we have been told was inevitable.. plunged…

Source: Bloomberg

Respondents had a few key themes (but in each they were mixed about the outcomes):

Uncertainty

• “Uncertainty” is the key word, and getting to a “new norm” so that business planning and forecasts can stabilize sooner than later is our hope as we look out six months.

• Decision-making remains extremely difficult due to extreme tariff uncertainty.

• I would say the uncertainty has decreased in the very short term (up to 90 days) based on the U.S.–China tariff rollback. However, it is hard to be certain of where we are heading next because the process has been so volatile.

Of course tariffs were a main topic of discussion:

• Tariffs [are an issue affecting our business].

• The tariff situation is controlling our business to date.

• Tariffs are causing us many issues: increasing costs as we try to increase U.S. manufacturing, and the price of components has increased.

• Forty-two percent tariffs on our product is much better than 157 percent. But it’s still 42 percent. It cuts into profits and sales.

Recession/Slowdown fears remain:

• Business is still moderately slow.

• We are still worried about immigration and its impact on employment. We are also concerned about an upcoming recession.

• It appears the customer has remained strong, but my perception of the general economy has gone down. President Trump’s tariff fight will only worsen the world’s business activity.

It seems the ‘soft’ data slump is starting to catch up to ‘hard’ data reality…

Source: Bloomberg

…who could have seen that coming!!??