New York manufacturing index slips 15 points in October

Still indicates solid sector growth      

The Empire State Manufacturing Survey general business-conditions index fell 15 points to 19.8 in October, “pointing to a slower pace of growth than last month.” 

The index — the monthly gauge of New York’s manufacturing sector — missed economists’ expectation of a reading of 25, according to a survey by The Wall Street Journal.

The October reading — based on firms responding to the survey — indicates business activity in New York still “grew at a solid pace,” the Federal Reserve Bank of New York said in its Oct. 15 report. A positive index number indicates expansion or growth in manufacturing activity, while a negative reading points to a decline in the sector. 

The survey found 39 respondents reported that conditions had improved over the month, while nearly 20 percent indicated that conditions had worsened, the New York Fed said.

Survey details

The new-orders index declined 9 points to 24.3, and the shipments index moved down 18 points to 8.9, indicating that growth “slowed” in both orders and shipments. 

The unfilled-orders index was little changed at 18.5. The delivery-times index inched up to a record high of 38.0, indicating “significantly longer” delivery times, the New York Fed said. Inventories increased “modestly.”

The prices-paid index rose 3 points to 78.7 and the prices-received index fell 4 points to 43.5, with both indexes holding near record highs. The index for number of employees came in at 17.1 and the average-workweek index declined 9 points to 15.3, pointing to “ongoing gains” in employment and hours worked.

The index for future business conditions increased 4 points to 52.0, indicating “continuing optimism” about the six-month outlook. 

New orders and shipments are both expected to increase “strongly” in the months ahead. Substantial increases in employment and prices are also expected. Both capital spending and technology spending increased “significantly.”

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.