Economic Update: Philadelphia Fed Index
The Philadelphia Fed Business Outlook Index was reported at -1.9 in September, which was above the consensus for a reading of -3.7 and represents an uptick from last month’s reading of -7.1
However, this was the fifth consecutive negative reading for the index.According to the report, “Firms responding to the September Business Outlook Survey reported nearly flat business activity this month. The survey’s indicators for general activity and new orders both improved from last month but recorded levels near zero. Firms reported continuing declines in shipments, employment, and hours worked. Indicators for the firms’ expectations over the next six months, however, improved notably this month, although the same firms forecast continued deceleration in production growth in the fourth quarter.”
The New Orders component was reported at 1.0 vs. -5.5 last month.
The Inventories component was reported at -21.7 vs. -6.9 last month.
The Employment component was reported at -7.3 vs. -8.6 last month.
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.
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