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1/25/2016, 8:46 PM (Source: TeleTrader)
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Texas economy sinks in the ever cheaper oil

Economic activity in Texas fell sharply in January, as the business activity index was -34.6, indicating contraction, according to data published by the Federal Reserve Bank of Dallas on Monday.

Dallas Fed’s Texas Manufacturing Outlook Survey reveals that the production index dropped 23 points, from 12.7 to -10.2. The bad numbers in the key measure of the state manufacturing conditions were followed by the new orders index, which edged down to -9.2, and the growth rate of orders index fell to -17.5, which was lowest in a year.

"The general business activity index fell 13 points to -34.6, and the company outlook index slipped to -19.5," said the Dallas Fed report, which invoked readings from April 2009, a time of recession. The company outlook index was also negative for the first time in seven years.

The employment index sank from 10.9 to -4.2, and there were also much less working hours, a nosedive of 23 points to -9.2.

Raw materials prices have been falling for the last 7 months, but the finished goods price index rose from previous -15.5 in December to -9.6 in January.

"Expectations regarding future business conditions weakened notably in January," said the report.

The largest state in the United States is heavily dependent on oil and gas production, and transportation of other goods, which also fell partly due to the strengthening dollar.

Light sweet crude WTI was down 6.00% to $30.24 a barrel at the ICE at 8:44 p.m. CET. The U.S. dollar was losing in the markets against the major world currencies, and was 0.36% weaker to the euro at $1.0837 at 8:53 p.m. CET.

 

Image: Federal Reserve Bank of Dallas/Andreas Praecefke (Creative Commons Attribution 3.0 Unported)

Breaking the News / ZR