November 2019 Philly Fed Manufacturing Survey Improved But Key Elements Declined

The Philly Fed Business Outlook Survey improved and remains in expansion.

Analyst Opinion of the Philly Fed Business Outlook Survey

Although the survey index improved, the key elements declined. Overall, this report was worse than last month's report.

This is a very noisy index which readers should be reminded of 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 +5.6 to +10.4. Positive numbers indicate market expansion, negative numbers indicate contraction. The market expected (from Econoday) 3.0 to 8.7 (consensus +7.5).

Manufacturing activity in the region continued to grow, according to results from the November Manufacturing Business Outlook Survey. The survey's broad indicators remained positive, although their movements were mixed this month: The indicator for general activity increased, but the new orders, shipments, and employment indicators decreased from their readings last month. The survey's future activity indexes remained positive, suggesting continued optimism about growth for the next six months.

Current Indicators Suggest Overall Growth

The diffusion index for current general activity rose 5 points this month to 10.4, after decreasing 6 points in October (see Chart). The percentage of firms reporting increases (30 percent) this month exceeded the percentage reporting decreases (20 percent). The indexes for current shipments and new orders both fell: The current new orders index decreased 18 points, while the shipments index decreased 9 points. Both the unfilled orders and delivery times indexes remained positive this month, suggesting higher unfilled orders and slower delivery times.


Econintersect believes the important elements of this survey are new orders and unfilled orders. New orders improved and remain in expansion whilst unfilled orders improved and remain in expansion.

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