After positive readings in both March and April, the Empire State Manufacturing Survey general business-conditions index plunged 19 points to -9.0 in May. Declines in new orders and shipments among New York manufacturers led the downturn. The results of the May survey indicated that business activity “declined” for New York manufacturers, the Federal Reserve Bank […]
After positive readings in both March and April, the Empire State Manufacturing Survey general business-conditions index plunged 19 points to -9.0 in May. Declines in new orders and shipments among New York manufacturers led the downturn.
The results of the May survey indicated that business activity “declined” for New York manufacturers, the Federal Reserve Bank of New York said in its survey report. A negative reading indicates a contraction in manufacturing activity, while a positive number on the index indicates expansion in the sector.
The May general business-conditions index level was much worse than economists were expecting. A MarketWatch.com poll of economists had forecast an index reading of 5.8.
The New York Fed said that 19 percent of New York manufacturers reported that conditions had improved over the latest month, while 28 percent said that conditions had worsened.
The new-orders index also turned negative, its 17-point drop to -5.5 signaling a decrease in orders.
The shipments index, down 12 points to -1.9, showed that shipments were “flat,” and the unfilled-orders index fell to -6.3, according to the New York Fed.
The delivery-time index, at -6.3, pointed to “shorter” delivery times, and the inventories index, at -7.3, suggested that inventory levels were “lower.”
The prices-paid index edged down three points to 16.7, an indication that input prices “continued to increase at a moderate pace.”
The prices-received index fell six points, to -3.1, as selling prices moved “slightly lower.”
Employment levels remained “fairly steady,” with the index for number of employees showing “little change” at 2.1, while the average-workweek index declined 10 points to -8.3, evidence that the average workweek was “shorter” this month, the New York Fed said.
Indexes for the six-month outlook generally suggested that firms were somewhat less optimistic about future conditions than they were in April.
The index for future business conditions was “little changed” at 28.5, while the index for future new orders fell 13 points to 22.4.
Future-employment indexes “conveyed an expectation” that employment levels and the average workweek would “rise modestly” over the next six months.
The capital-expenditures index fell 19 points to 3.1, its lowest level in more than two years, and the technology spending index fell to 6.3.
The New York Fed distributes the Empire State Manufacturing Survey on the first day of each month to the same pool of about 200 manufacturing executives in New York. On average, about 100 executives return responses.
Contact Reinhardt at ereinhardt@cnybj.com