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Richmond Fed's Current Activity unchanged at -6
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Manufacturing activity in the central Atlantic region continued to contract in October, according to the Richmond Fed's latest survey. The index of overall activity remained at last month's level with all broad indicators — shipments, new orders, and employment — landing in negative territory. Continued softness was also evident in most other indicators. District contacts reported more moderate weakness in backlogs and capacity utilization, but noted that delivery times and raw materials inventories grew at a somewhat quicker pace.
Looking ahead, manufacturers' assessments of business prospects for the next six months were on par with last month. Contacts at more firms anticipated that shipments, new orders, backlogs, and capacity utilization would grow roughly on pace with September's expectations, while growth in capital expenditures would be faster.
Survey assessments of current prices revealed that raw materials grew at a somewhat slower rate in October than a month ago, while finished goods prices grew at a slightly faster pace. Over the next six months, respondents expected growth in both raw materials and finished goods prices to rise more slowly from what they had anticipated last month.
In October, the seasonally adjusted composite index of manufacturing activity — our broadest measure of manufacturing — was unchanged from September's reading of −6. Among the index's components, shipments lost four points to −6, while new orders gained twelve points to finish at −5 and the jobs index turned negative, moving down fourteen points to −7.
Most other indicators also suggested continued weakness. The index for backlogs of orders rose eight points to finish at −15, and the capacity utilization indicator picked up seven points to −4. Additionally, the delivery times index turned positive, adding four points to end at 2, while our gauges for inventories were mixed in October. The finished goods inventories index was virtually unchanged at 23, while the raw materials inventory index gained seven points to end at 25.
Posted: October 25, 2011 Tuesday 10:00 AM