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 7/17/08 For Jul 2008 | ||||||||||||
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Highlights
The Philadelphia Federal Reserve's manufacturing extended its run so far this year of negative readings, at -16.3 in July vs. -17.1 in June. New orders continue to contract, at -12.1 vs. June's -12.4, with shipments also contracting, -8.0 vs. -6.7. These results point to declines in ISM's manufacturing report and durable goods shipments and orders, certainly a negative for factory employment. The report's employment index showed contraction, at -7.3 vs. -6.9.
Price data show great pressure with input prices up to 75.6 vs. 69.3 and output prices, an important index for this report, at 28.8 vs. 29.7. This indicates that cost pressures are widespread. Treasury yields dipped in immediate reaction to the results.
The general business conditions component of the Philadelphia Fed's business outlook survey index fell another point-and-a-half into negative territory, to minus 17.1 for the June reading. The outlook is not good as new orders worsened to minus 12.4 from minus 3.7 in May. Meanwhile, inflation pressures have been building as the prices paid index jumped more than 15 points to 69.3, while prices received remains unusually high at 29.7. In recent months, the Philly Fed report has been pointing toward stagflation.
Philadelphia Fed survey Consensus Forecast for July 08: -17.0
Range: -22.0 to -9.0
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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. |
| 2008 Release Schedule | ||||||||||||||||||||||||||
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