Manufacturers feeling positive

Despite only modest growth in December, businesses optimistic about their prospects.

Texas manufacturing activity expanded slowly in December, but producers reported a marked improvement in their outlooks for business conditions, according to a report released Monday by the Federal Reserve Bank of Dallas.

The state production index, a key measure of factory activity, inched forward to a reading of 2.7 in December from 1.7 the prior month, according to the monthly Texas Manufacturing Outlook Survey.

While a positive number indicates expansion, the production index remained at levels lower than most of 2012. That measure typically tracks closely with the state’s overall economic activity, so it provides one of the most current glimpses of the Texas economy.

Despite the lukewarm growth and continuing economic uncertainties in December, manufacturers reported a much more optimistic outlook for both general business activity and company-specific conditions.

In November, producers had taken a sharply pessimistic turn, citing worries about the fallout of the elections, tepid demand and congressional negotiations over the “fiscal cliff” issues. While those concerns remained in December, according to the survey, the two closely watched business-sentiment indexes rose sharply — both for the current environment and for prospects six months