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 12/17/07 For Dec 2007 | ||||||||||||
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Highlights
The Empire State index fell back a very steep 17 points in December for a 10.3 reading that points to only a moderate rate of growth in the area's manufacturing sector. New orders, the most important of the report's components, likewise fell back, to 14.3 from 24.5. Unfilled orders, at -10.0, contracted for a second month. Shipments showed a month-to-month gain but at a slower rate, at 21.1 vs. 32.2. The rise in shipments was posted despite a slip in the workweek, which fell more than 10 points to -7.5.
Prices were a positive in the report in what is a relief given last week's jolting PPI jump. The prices paid index slipped to a less severe 35.0 from 42.9 while prices received was little changed, showing only a fractional rise to 12.5. Another positive was a slight improvement in the overall six-month outlook, up nearly 2 points to 32.4.
Last week's industrial production report showed strength in manufacturing and eased concern the sector may be entering a slump. The Empire State report is a very volatile report and today's results shouldn't darken the outlook much, but a repeat of these results in Thursday's manufacturing report from the Philadelphia Fed would definitely raise new questions on the manufacturing sector.
The Empire State manufacturing index in November dipped only fractionally to 27.4, reflecting a steady and healthy rate of new orders and shipments that are near the headline level. The New York Fed's manufacturing index has been the outlier, being notably stronger than most of the recent indicators for manufacturing which have ranged from slightly negative to marginally positive.
Empire State Manufacturing Survey Consensus Forecast for December 07: 21.5
Range: 19.0 to 27.0
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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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