January 2019 Richmond Fed Manufacturing Survey Remains In Contraction

Of the three regional Federal Reserve surveys released to date all, EXCEPT this Richmond Fed survey, are in expansion.

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Analyst Opinion of Richmond Manufacturing

The important Richmond Fed subcategories growth well into contraction. This survey was weak compared to last month as the significant subcategories were worse than last month. I would expect slowing of the Federal Reserve's manufacturing index.

The market expectations from Econoday was -10 to +3 (consensus -3). The actual survey value was -2 [note that values above zero represent expansion].

Fifth District manufacturing activity was soft in January, according to the latest survey from the Richmond Fed. The composite index rose from −8 in December to −2 in January but continued to indicate weak growth. The rise from December came from increases in the component indexes of employment and shipments, although the shipments index remained negative. The third component, new orders, dropped to −11, its lowest reading since June 2016. Meanwhile, the index for backlog of orders fell to −21, its lowest reading since May 2009. However, manufacturers remained optimistic that conditions would improve in the coming months.

Survey results indicated continued growth in employment and wages in January, but firms still struggled to find workers with the skills they need. Respondents expected this struggle to continue, along with employment and wage growth, in the near future.

The growth rate of prices paid by survey respondents fell in January, but continued to outpace that of prices received, which held steady. Firms expected growth to slow for both prices paid and prices received in the next six months.

Richmond Fed (hyperlink to reports):


Summary of all Federal Reserve Districts Manufacturing:

Kansas Fed (hyperlink to reports):

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Dallas Fed (hyperlink to reports):

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