January 2019 Philly Fed Manufacturing Survey Improved

The Philly Fed Business Outlook Survey improved and remains in expansion. Key elements were mixed.

Analyst Opinion of the Philly Fed Business Outlook Survey

Consider this a stronger report than last month. But it does not make sense that new orders improved and backlog declined.

This is a very noisy index which readers should be reminded is sentiment based. The Philly Fed historically is one of the more negative of all the Fed manufacturing surveys but has been more positive than the others recently.

The index moved from +9.1 to +17.0. Positive numbers indicate market expansion, negative numbers indicate contraction. The market expected (from Econoday) 9.4 to 11.0 (consensus +10.0).

Manufacturing activity in the region continued to grow, according to results from the January Manufacturing Business Outlook Survey. The survey's broad indicators remained positive, although their movements were mixed again this month: The general activity and new orders indicators increased from their readings last month, while the indicators for shipments and employment decreased. The firms reported growth in the underlying demand for their products and are generally optimistic about future growth and employment.

Current Indicators Suggest Growth

The index for current manufacturing activity in the region increased from a revised reading of 9.1 in December to 17.0 this month* (see Chart 1). Over 30 percent of the manufacturers reported increases in overall activity, while 13 percent reported decreases. The new orders index increased 8 points to 21.3, its highest reading in six months. The current shipments index, however, decreased 1 point to 11.4. Both the unfilled orders and delivery times indexes were positive this month, suggesting higher unfilled orders and slower delivery times. Inventories declined this month: The current inventory index fell 10 points to -7.6, its first negative reading in 14 months.

Econintersect believes the important elements of this survey are new orders and unfilled orders. New orders significantly improved and remains in expansion whilst unfilled orders modestly declined but remained in contraction.

1 2 3
View single page >> |

Disclaimer: No content is to be construed as investment advise and all content is provided for informational purposes only.The reader is solely responsible for determining whether any investment, ...

How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.


Leave a comment to automatically be entered into our contest to win a free Echo Show.