Empire Manufacturing Report Disappoints

The latest read of the NY Fed Manufacturing report didn’t give such a great preview of economic activity for the month of September. At the headline level, the General Business conditions index dropped from 25.6 down to 19.0 versus expectations for a decline to 23.0.

Similar to the current conditions index, the index tracking expectations for six months from now also declined by a similar amount, falling from 34.8 down to 30.3. As shown in the lower chart, plans for Cap Ex and Technology Spending also saw modest declines.

The table below breaks down this month’s report by each of the sub-categories for the Empire Manufacturing report and how their measurements for current conditions and expectations changed relative to August. As shown, in terms of both Current Conditions and Expectations, the majority of categories declined.In terms of Current Conditions, Shipments showed a sizable decline, falling 11.4 points.

On the inflation front, Prices Paid increased in terms of both Current Conditions and Expectations with the latter index rising to its highest level since May 2012.

Within Prices Paid, there was a pretty wide disparity between Current Conditions (down) and Expectations (up).

Finally, with respect to the Average Workweek, manufacturers reported slight increases in the present but are expecting declines going forward as that index dropped into negative territory for the first time in two years.