Research >> Economics
Richmond Fed's Current Activity Index gained 7 points to a reading of 13
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Fifth District manufacturing activity increased moderately in July, according to the most recent survey by the Federal Reserve Bank of Richmond.* Shipments and new orders picked up this month, and order backlogs also strengthened. Manufacturing employment softened this month, and average wages continued to increase at a moderate pace. Prices of raw materials rose more quickly in July compared to last month, while prices of finished goods grew about on pace.
Manufacturers remained optimistic about future business conditions. Survey participants expected faster growth in shipments and in the volume of new orders in the six months ahead. Producers looked for increased capacity utilization and anticipated rising backlogs. Expectations were for longer vendor lead times.
Survey participants anticipated an increase in hiring and solid growth in wages during the next six months. However, they expected modest growth in the average workweek. For the six months ahead, manufacturers expected little change in prices paid, although they looked for faster growth in prices received.
Overall, manufacturing conditions strengthened in July. The composite index moved to a reading of 13 from last month's reading of 7. Shipments advanced 11 points to end at 16, while the index for new orders added seven points to finish at a reading of 17. Manufacturing employment softened this month; the index settled at 1.
Backlogs rose at a faster pace this month; the index gained seven points, ending at 10. Additionally, capacity utilization grew at a faster pace, moving the index up three points to a reading of 9. Vendor lead time shortened slightly, with that index edging down one point to 4. Finished goods inventories rose at a slower pace compared to a month ago. The index lost six points to end at 24. Raw materials inventories also increased at a slower pace this month. That gauge declined seven points to 16.
Posted: July 28, 2015 Tuesday 10:00 AM