Composites Index extends strong expansion trend

The GBI: Composites Fabricating Index continued its expansion trend with a 56.6 reading for October.
#economics #regulation


Facebook Share Icon LinkedIn Share Icon Twitter Share Icon Share by EMail icon Print Icon

The GBI: Composites Fabricating Index retained its accelerated growth trend in October, registering a solid 56.6. This sets the year-to-date average index reading at 58.2, which if left unchanged, will establish 2018 as the best year in history for the Index. For comparison, the current record was established in 2017 at an average reading for the year at 55.1. The latest reading is 4.8% lower than during the same month one year ago; however, the prior year’s reading at that time was also an all-time high monthly reading. Gardner Intelligence’s review of the underlying data for the month indicates that the Index was pulled higher by supplier deliveries, new orders and production. The Index – calculated as an average — was pulled lower by backlogs, employment and exports.

During the month, supplier deliveries and new orders rose, while all other components grew at slower rates than in the prior month. For a fifth consecutive month, exports contracted, yet the strong reading for new orders suggests that domestic demand is offsetting export weakness. The composites industry is particularly susceptible to export volatility induced either by trade regulations or foreign exchange fluctuations, or both. Since April, both factors have had a significant impact on the composites industry. The US dollar has appreciated by roughly 10% against the Chinese Yuan, while trade sanctions imposed by China have made several types of US aircraft and aerospace products more expensive.