Factory activity in New York decelerates for fourth straight month in January

Factory activity in New York decelerates for fourth straight month in January

The numbers: The New York Fed’s Empire State business conditions index fell 1.4 points to 3.5 in January, the regional Fed bank said Friday. That is the fourth straight drop and the lowest level of activity since June. Economists had expected a reading of 7.2, according to a survey by the Wall Street Journal.

Any reading above zero indicates improving conditions.

What happened: The new orders index rose 3.2 points to 6.6 in January. Shipments lost 4.8 points to 7.3. Unfilled orders dipped 1.9 points to negative 5.5. Input price increases and selling price increases both picked up “noticeably,” the New York Fed said. The prices paid index has risen 41 points since May. Optimism about the next six-months dipped 4.4 points to 31.9.

Big picture: Growth remains sluggish in New York as the region continues to struggle through the coronavirus pandemic. Activity in New York is at the low end of regional Fed surveys. Manufacturing across the country is in better shape than the services sector, which has suffered tremendously as Americans have avoided person-to-person contact. The national ISM factory index jumped to 60.7 in December, the highest level since August 2018.

Market reaction: Stock-index futures lost ground Friday morning after President-elect Joe Biden announced a $1.9 trillion COVID-19 relief plan. The Dow Jones Industrial Average

fell 68.95 points on Thursday.

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