Philly Fed Index Inches Higher But Remains Negative In October

(RTTNews) - The Federal Reserve Bank of Philadelphia released a report on Thursday showing a continued contraction in regional manufacturing activity in the month of October.

The Philly Fed said its diffusion index for current activity inched up to a negative 8.7 in October from a negative 9.9 in September, but a negative reading still indicates a contraction. Economists had expected the index to climb to a negative 5.0.

The uptick by the headline index partly reflected a slightly slower pace of contraction in new orders, as the new orders crept up to a negative 15.9 in October from a negative 17.6 in September.

The number of employees also jumped to 28.5 in October from 12.0 in September, indicating a notable faster rate of job growth.

Meanwhile, the shipments index edged down to 8.6 in October from 8.8 in September, dipping to its lowest reading since May 2020.

The report also showed the prices paid index rose to 36.3 in October from 29.8 in September, while the prices received index crept up 30.8 from 29.6.

Looking ahead, the Philly Fed said the survey's future general activity indexes suggest that the surveyed firms expect declines overall over the next six months.

The diffusion index for future general activity slumped to a negative 14.9 in October from a negative 3.9 in September, remaining negative for the fifth straight month.

A separate report released by the Federal Reserve Bank of New York on Monday showed regional manufacturing activity has contracted by more than expected in the month of October.

The New York Fed said its general business conditions index slid to a negative 9.1 in October from a negative 1.5 in September, with a negative reading indicating a contraction in regional manufacturing activity. Economists had expected the index to dip to a negative 4.0.

Looking ahead, the New York Fed said firms do not expect business conditions to improve over the next six months.