The Federal Reserve Bank of Philadelphia released a report on Thursday showing regional manufacturing activity has contracted at a slower rate in the month of January.
The Philly Fed said its diffusion index for current activity climbed to a negative 8.9 in January from a negative 13.7 in December, although a negative reading still indicates a contraction. Economists had expected the index to inch up to a negative 11.0.
The increase by the headline index was partly due to a rebound by shipments, with the shipments index surging to a positive 11.1 in January from a negative 0.9 in December.
The report also showed a turnaround in employment, as the number of employees index jumped to a positive 10.9 in January from a negative 0.9 in the previous month.
The new orders index also showed a notable increase but remained negative, climbing to a negative 10.9 in January from a negative 22.3 in December.
On the inflation front, the prices paid index slid to 24.5 in January from 36.3 in December, while the prices received index inched up to 29.9 from 28.1.
The Philly Fed also said most future indicators were positive, but expectations for growth over the next six months were not widespread.
The diffusion index for future general activity climbed to a positive 4.9 in January from a negative 0.9 in December.
On Tuesday, the New York Federal Reserve released a separate report showing a significant contraction in New York manufacturing activity in the month of January.
The New York Fed said its general business conditions plunged to a negative 32.9 in January from a negative 11.2 in December. Economists had expected the index to climb to a negative 4.5.
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