Kansas City Fed Composite Manufacturing Index Falls to 11 as Orders Weaken

The Federal Reserve Bank of Kansas City’s Tenth District manufacturing composite fell to 11 in October as new orders weakened, while its six-month outlook improved, leaving current and expected activity with different signals.

The seasonally adjusted month-over-month index averages five diffusion indexes: production, new orders, employment, supplier delivery time and raw-material inventories. Each component compares the share of firms reporting increases with the share reporting declines. A positive composite reflects net increases across those component measures; it is not a count of respondents reporting gains. The survey measures conditions in the Tenth District.

The composite stood at 14 in September, up from 10 in August; an earlier report on the district composite covered that increase. In October, the new-orders index fell to 3 from 24. The backlog-of-orders index moved to -5 from 13, while production eased to 16 from 20. The positive readings for new orders and production, alongside a negative backlog reading, show the components did not move together.

The raw-material prices-paid index rose to 70 from 68, while the finished-product prices-received index fell to 26 from 37. These are diffusion-index readings, not percentage changes in prices. On customer sensitivity, 22% of firms said customers were much more sensitive than six months earlier, 31% said somewhat more sensitive, and 41% said about as sensitive.

The six-month composite outlook increased to 22 from 19. Future-activity expectations reached their highest readings since July 2022. The composite measures current month-over-month conditions, while the outlook captures expectations six months ahead; both indexes are seasonally adjusted.

Cortney Cowley, assistant vice president and Oklahoma City Branch executive, said, “District manufacturing activity continued at a solid pace in October, and firms expect activity to increase in the near-term.”

The Oct. 14-19, 2026, survey drew 95 plant responses across Colorado, Kansas, Nebraska, Oklahoma and Wyoming, as well as northern New Mexico and western Missouri. The Tenth District includes those five states, along with northern New Mexico and the western third of Missouri, making the survey a regional measure rather than a national manufacturing statistic.