Highlights
Data are beginning to point to contraction for the manufacturing sector, including the business activity index from the Philadelphia Federal Reserve which extended a string of declines in May with a -15.6 reading. But new orders are showing less severe contraction, at -3.7 in May to indicate only marginal decline from April. Shipments actually rose in the May report, to 2.2 vs. -8.0 in April but largely due to the filling of unfilled orders which, at -19.1, contracted even more severely than April. Declines in inventories and quickening delivery times confirm that business activity is light. Employee readings show continued erosion indicating that manufacturers are cutting back on staff and especially the workweek.

Input prices keep climbing as they are through the broad sweep of business surveys. The prices paid index in this report rose more than 2 points to 53.8. Output prices have been showing less pressure, confirmed of course by yesterday's surprisingly mild consumer price report. But this report's prices received index did rise, to 31.6 for a 7 tenth gain and in contrast to an easing for this index in this morning's Empire State report from the New York Fed.

A positive in the report, as it was in the Empire State report, is greater optimism for the future, hope that definitely belies current readings. The six-month outlook index jumped to 28.2 from 13.7 in April indicating that manufacturers are upbeat and do not see current conditions worsening -- a big improvement from March when the reading was negative. Another positive in the report is that the main index, though well into negative territory, is showing less weakness than the -24.9 level in April. The nation's manufacturing sector, as especially indicated in this morning's industrial production report, appears to have tipped into contraction but only mild contraction for now.

2008 Release Schedule

Released On: 1/17 2/21 3/20 4/17 5/15 6/19 7/17 8/21 9/18 10/16 11/20 12/18 Released For: Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec