Manufacturing activity in the central Atlantic region declined in January following two months of modest expansion, according to the Richmond Fed’s latest survey. Nearly all broad indicators of activity fell into negative territory. Other indicators also suggested additional softness. Capacity utilization turned negative as did the gauge for delivery times, while backlogs continued its downward trend. In addition, finished goods inventories grew at a slightly quicker pace.
Looking ahead, assessments of business prospects for the next six months were somewhat more optimistic in January. An increasing number of contacts anticipated faster growth for new orders, capacity utilization, vendor lead-time, average workweek and capital expenditures, pushing up those indicators.
Survey assessments of current prices indicated that raw materials prices grew at a slightly quicker pace than in December, while finished goods prices grew at a slightly slower rate. Over the next six months, respondents expected raw materials prices to grow at a slightly slower pace compared to their outlook of last month, while they expected finished goods prices to grow at a somewhat quicker rate than they had anticipated a month earlier.
In January, the seasonally adjusted composite index of manufacturing activity — our broadest measure of manufacturing — lost seventeen points to settle at −12 from December’s reading of 5. Among the index’s components, shipments fell seventeen points to −11, the gauge for new orders moved down twenty-seven points to end at −17, and the jobs index slipped two points to −5.
Other indicators also suggested weakening in January. The index for capacity utilization moved lower, subtracting twenty-one points to −18, and the backlogs of orders lost eight points to end at −19. The delivery times index turned negative, giving up seven points to end at −4. The raw materials inventory index was virtually unchanged at 23, while the finished goods inventories gained nine points to also end at 23.
Read entire source document from Richmond Fed
Summary of all Federal Reserve Districts Manufacturing:
Richmond Fed (hyperlink to reports):
Kansas Fed (hyperlink to reports):
Dallas Fed (hyperlink to reports):
Philly Fed (hyperlink to reports):
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New York Fed (hyperlink to reports):
Federal Reserve Industrial Production – Actual Data (hyperlink to report)
Holding this and other survey’s Econintersect follows accountable for their predictions, the following graph compares the hard data from Industrial Products manufacturing subindex (dark blue bar) and US Census manufacturing shipments (lighter blue bar) to the Richmond Fed Survey (dark green bar).
Comparing Surveys to Hard Data
In the above graphic, hard data is the long bars, and surveys are the short bars. The arrows on the left side are the key to growth or contraction.
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