Phew! July Philly Fed BEATS Expectations At 3.2

philly philadelphia

Photo: Ben Franske, Wikimedia Commons

The number:+3.2!

A big relief as the closely watched economic survey swings back into black from -7.7 last time.

This is from the report.


July 2011 Business Outlook Survey

Responses to the Business Outlook Survey suggest that regional manufacturing activity remained weak in July. The survey’s indicators for activity and new orders, which had turned negative last month, recovered somewhat but are at very low positive readings. Firms indicated that employment grew modestly while the average workweek lessened. Indexes for prices show a continuing trend of moderating price pressures. The broadest indicator of future activity improved markedly this month, rebounding from its lowest reading in 31 months in June.

Indicators Suggest Activity Is Near Steady

The survey’s broadest measure of manufacturing conditions, the diffusion index of current activity, increased to 3.2 from -7.7 (see Chart). The demand for manufactured goods, as measured by the current new orders index, improved from last month but suggests flat demand: The index rose 8 points to a reading of zero, and the percentage of firms reporting increases was equally matched by the percentage reporting decreases (28 per cent). The current shipments index remained slightly positive but virtually unchanged from June.

Firms’ responses suggest a slight improvement in the labour market compared to June. The current employment index increased 5 points and remained positive for the 11th consecutive month. About 22 per cent of the firms reported an increase in employment, up slightly from 14 per cent last month. Slightly more firms reported a shorter workweek (21 per cent) than re-ported a longer one (15 per cent) and the workweek index was down 7 points.

Price Pressures Show Further Moderation
Diffusion indexes for prices paid and prices received were lower this month and suggest a continued trend of moderating price pressures. The prices paid index declined 2 points, following a sharp drop of 22 points last month. Still, one-third of the firms reported higher prices for inputs this month, and 8 per cent reported a decline. Only slightly more firms reported a rise in prices for manufactured goods (18 per cent) than reported declines (17 per cent). The prices received index decreased 3 points, its third consecutive monthly decline.

Original post: This is a closely-watched regional Philly Fed report that’s been pretty weak of lately.

Analysts expect the headline number to go from -7.7 to 2.0.

It should provide a nice look at the state of manufacturing right now.

The number comes out at 10:00 AM.

Refresh for LIVE updates.

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