A Deep Dive Into The Bizarre And Disastrous Empire State Manufacturing Index

The headline numbers release this morning from the New York Fed regarding manufacturing in New York were ugly. The survey plunged 27 points to -11.1 thanks to a collapse in new orders.

Other internals slumped as well.

And yet, that wasn’t the whole story. Respondents to the survey were actually much more optimistic about the medium-term (six months) than they were last month.

Bear in mind that each measure uses a diffusion index — i.e., the number represents the difference between respondents who see things getting better and who see things getting worse. Thus, if 70% of respondents see things going up, and 30% see them going down, the index would be at 40.

General business conditions have gone negative

A huge plunge in new orders is the primary culprit

Shipments, not surprisingly, are way down

Unfilled orders, again, are dissipating

Oddly, prices paid are down, despite all the talk about inflation at the wholesale level

More companies are adding employees, though less so

Employee work-week down

Now here's the kicker... this is the six-month outlook. Much better!

Outlook for new orders also spiked

Shipment outlook is up!

Unfilled orders seen getting better

Pricing power is expected

And more employees are on the way.

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