Manufacturing in New York is starting to steady.
The latest Empire State manufacturing index came in at 0.62 for March.
This reading was significantly higher than economists’ expectation of -10.50, according to Bloomberg.
Notably, this is the first positive reading since July 2015.
This follows last month’s manufacturing index of -16.64, which missed expectations.
The New York Fed noted in its report that business activity steadied for New York manufacturing firms. The new orders index posted a “steep gain” of 21 points to 9.6 — a positive reading that marked the first time orders had increased in several months. Additionally, the shipments index increased 25 points to 13.9, signalling an increase in shipments.
Price indexes suggested a slight increase in input prices and a small decline in selling prices.
The “number of employees” index edged down to -2.0, indicating that employment levels remained fairly steady. The average workweek index rose 2.0, a sign that the average workweek also changed little.
Confidence about future business conditions climbed higher, and the index for future new orders hit its highest level in more than a year.
Manufacturing activity had been hammered over the past few months by the stronger dollar, which made goods pricier, and weak global demand.
“Overall, the Empire State survey supports our view that we are moving past the weakest period for the data. We will see whether or not other March surveys reported over the coming weeks also support this view,” wrote JPMorgan’s Daniel Silver.
“The New York Fed district makes up a small minority of the overall manufacturing sector, but we think that the return to positive territory this month is a harbinger of better overall manufacturing data to come,” wrote Jefferies’ Ward McCarthy and Thomas Simons. “However, we also expect that the rebound in the sector will be choppy and erratic.”