The New York Fed conducts this monthly survey of manufacturers in New York State. Participants from across the state represent a variety of industries. On the first of each month, the same pool of roughly 175 manufacturing executives (usually the CEO or the president) is sent a questionnaire to report the change in an assortment of indicators from the previous month. Respondents also give their views about the likely direction of these same indicators six months ahead. This index is seasonally adjusted using the Philadelphia Fed's seasonal factors because its own history is not long enough with data only going back a couple of years. (Federal Reserve Bank of New York) Why Investors Care
| Released on 3/15/07 For Mar 2007 | ||||||||||||
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Highlights
The Empire State index fell sharply to 1.9 in March from 24.4 in February pointing to flat conditions at best in the region's manufacturing sector and underscoring the risk of contractionary readings in today's Philadelphia Fed report and the month's ISM report.
New orders in the Empire State showed very little growth in March at 3.1 vs. February's 18.9. Unfilled orders contracted to -8.1 vs. no change in February. Stagnant order growth points to slowing production and slowing employment in the months ahead.
Supply managers, reacting to the slowing conditions, are hitting the inventory brakes hard. The inventory index contracted for a fourth straight month, at -4.7 in March. Delivery times are speeding up quickly, at -4.7 also. Price pressures, due to oil costs, remain steady.
Manufacturing reports have been showing lots of supply chain activity as firms cut back in anticipation that demand will slow. The Philadelphia Fed report showed very similar conditions in its February report. It's March report will be issued at noon ET.
The Empire State manufacturing index jumped sharply to 24.4 in February from a soft January reading of 9.1. New orders also improved, suggesting forward momentum. However, last week's reported manufacturing aggregate production hours in the employment report showed a dip of 0.1 percent for February - suggesting weakness in manufacturing for the month.
Empire State Manufacturing Survey Consensus Forecast for March 07: +16.0
Range: +10.3 to +20.0
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The Empire State Manufacturing Survey has a much shorter history than the Philadelphia Fed's business outlook survey. The two series tend to move in tandem much of the time, although not each and every month. They are both considered leading indicators for the ISM manufacturing survey. |
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