The Richmond Federal Reserve’s manufacturing index collapsed to zero.
The prior reading was 14, which crushed expectations.
Shipments: -1 verus prior 17
New orders: 5 versus prior 16
Employees: -6 versus prior 6
“Fifth District manufacturing activity was little changed in September, according to the most recent survey by the Federal Reserve Bank of Richmond. Shipments, capacity utilization, and vendor lead time flattened, while the volume of new orders slowed. The backlog of new orders remained in decline. Finished goods inventories and raw materials inventories built up at about the same pace as in August. Manufacturing employment fell and the average work week shrank, while wage growth remained robust.
“Looking ahead six months, manufacturers’ optimism about business prospects strengthened. Firms expected a greater volume of new orders, rising capacity utilization, with shorter lead-times and a solid increase in shipments. Further, they anticipated that the backlog of orders would grow. Additionally, survey participants expected a jump in capital expenditures. Manufacturers looked for the number of employees to climb and average workweek to moderate. Their outlook was for slightly slower average wage growth.
“Raw materials and finished goods prices rose more quickly in September compared to last month. In addition, relative to their outlook of a month ago, surveyed manufacturers expected prices to rise more quickly in the next six months.”