The general conditions index from this business outlook survey is a diffusion index of manufacturing conditions within the Philadelphia Federal Reserve district. This survey, widely followed as an indicator of manufacturing sector trends, is correlated with the ISM manufacturing index and the index of industrial production. Why Investors Care
| Released on 1/18/07 For Jan 2007 | ||||||||||||
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Highlights
Signals are mixed but the manufacturing sector appears to be leveling as the Philadelphia Federal Reserve's business activity index rose to a respectable 8.3 in January from a contractionary -2.3 in December. The Empire State report issued earlier in the week showed a similar level of strength though down from the report's December level. The ISM's manufacturing report slipped briefly into contractionary ground during November before edging back up in December. Today's Philadelphia report is likely to boost confidence for a non-contractionary reading in January's ISM to be released at the beginning of February. Bonds edged lower in initial reaction to today's results.
New orders in the Philadelphia report firmed slightly to 1.3 in January from -0.9 in December, pointing to stable overall business activity in the months ahead. Shipments rose sharply in the month to 23.9 from 14.0 with most other readings little changed. Price data were mixed with input prices showing less pressure, 11.9 vs. 19.0, and output prices showing slightly more pressure, 11.6 vs. 8.9.
The general business conditions component of the Philadelphia Fed's business outlook survey index fell to minus 4.3 in December from 5.1 in November. The Philly Fed index generally has been weaker than other regional manufacturing indexes in recent months. Both new orders and backlogs were negative last month and suggest further weakness ahead in the overall business conditions index.
Philadelphia Fed survey Consensus Forecast for January 07: +5.0
Range: -7.5 to +10.0
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The Philadelphia Fed's business outlook survey is a good leading indicator for the index of industrial production. It is reported in the third week of the month and thus has a lead time of nearly three weeks. |
| 2007 Release Schedule | ||||||||||||||||||||||||||
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