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Economic Update: Philadelphia Fed Index
The Philadelphia Fed Business Outlook Index was reported at -16.6 in June, which was once again well below the consensus for a reading of +0.3 and last month’s reading of -5.8 (April: +8.5)
According to the report, “Firms responding to the June Business Outlook Survey indicated weaker business conditions this month. The survey’s indicators for general activity, new orders, shipments, and average work hours were all negative this month, suggesting overall declines in business. Input price pressures were less in evidence this month, with more firms reporting declines in input prices. And for the second consecutive month, more firms reported declines in prices for their products than reported increases. The survey’s indicators of future activity remained positive and improved slightly, suggesting that the current weakness in activity is expected to be short-lived.”
”The survey’s broadest measure of manufacturing conditions, the diffusion index of current activity, fell from a reading of -5.8 in May to -16.6, its second consecutive negative reading. Nearly 40 percent of the firms reported declines in activity this month, exceeding the 22 percent that reported increases in activity. Indexes for new orders and shipments also showed notable declines, falling 18 and 20 points, respectively. Indexes for current unfilled orders and delivery times both registered negative readings again this month, suggesting lower levels of unfilled orders and faster deliveries.”
The current employment index, which before last month had been positive for eight consecutive months, rose 3 points, to -1.3. The percentage of firms reporting decreases in employment (12 percent) was slightly below than the percentage reporting increases (14 percent).
According to Investopedia, the Philly Fed Index is a regional federal-reserve-bank index measuring changes in business growth. The index is constructed from a survey of participants who voluntarily answer questions regarding the direction of change in their overall business activities. The survey is a measure of regional manufacturing growth. When the index is above 0 it indicates factory-sector growth, and when below 0 indicates contraction.
Other stories on the US Economy to review:
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Flash PMI in US Shows Manufacturing Growth Slowing
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Housing Starts Down But Permits Up Strong
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UofM's Consumer Sentiment also Weak
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Industrial Production and Capacity Utilization Below
Expectations
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Empire Manufacturing Disappoints in June
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CPI Declines in May
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Business Inventories Above Expectations in April
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Retail Sales Fall Across Board in May
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PPI Shows Inflation Fell at Producer Level in May
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NFIB Small Business Optimism Pulls Back
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ISM Non-Manufacturing Index Above Expectations
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Some Good News: Employment Trend Index Moves Up
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May Jobs Report Disappoints Big Time
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ISM Report Shows Growth Slowing
- Q1 GDP Revised Lower
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