New orders, shipments decline Declines in the indexes for both new orders and shipments were again factors as the general business conditions index of the Empire State Manufacturing Survey plunged 26 points to -20 in March. In the past couple months, the index rose 18 points to 5.7 […]
New orders, shipments decline
Declines in the indexes for both new orders and shipments were again factors as the general business conditions index of the Empire State Manufacturing Survey plunged 26 points to -20 in March.
In the past couple months, the index rose 18 points to 5.7 in February after sliding 15 points to -12.6 in January. The general business conditions index is the monthly gauge of New York’s manufacturing sector.
Based on firms responding to the survey, the March reading indicates business activity “dropped significantly” in New York state, the Federal Reserve Bank of New York said in its March 17 report.
A negative index number indicates a decline in the manufacturing sector, while a positive reading points to expansion or growth in manufacturing activity.
The March reading was much worse than economists expected. A Reuters survey of economists found a median forecast of -1.50 for the index for the month.
The Empire State Survey found the indexes for new orders and shipments both fell into negative territory at -14.9 and -8.5 respectively, the New York Fed said.
At the same time, optimism about the outlook “waned considerably” for a second straight month.
Survey details
The new-orders index fell 26 points to -14.9, and the shipments index slipped 23 points to -8.5 in March, indicating that both orders and shipments declined after increasing the prior month, the New York Fed said.
Unfilled orders held steady. The inventories index moved up 5 points to 13.3, its highest reading in more than two years, signaling that business inventories continued to expand.
The delivery-times index came in at 1.0 in March, and the supply-availability index was -1.0, suggesting delivery times and supply availability were little changed.
The index for number of employees held steady at -4.1, and the average-workweek index was -2.5, pointing to a slight decline in both employment and hours worked. Both price indexes climbed for a third straight month. The prices-paid index rose 5 points to 44.9, its highest level in more than two years, and the prices-received index rose 3 points to 22.4, its highest reading since May 2023.
Survey results also indicate that firms continued to grow less optimistic about the outlook.
After dropping 15 points in February, the index for future business activity fell another 10 points in March to 12.7. Capital-spending plans “remained soft.” Supply availability is “expected to contract somewhat” in the months ahead, the New York Fed said.
The Federal Reserve Bank of New York 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.
