Empire State Manufacturing Survey

Business activity continued to grow strongly in New York State, according to firms responding to the June 2018 Empire State Manufacturing Survey.

The headline general business conditions index climbed five points to 25.0, indicating a faster pace of growth than in May. Both the new orders index and the shipments index showed ongoing solid growth, with
the former rising five points to 21.3 and the latter moving up four points to 23.5. Delivery times continued to lengthen, and inventories edged higher. Labor market indicators pointed to a substantial increase in employment and longer workweeks. The prices paid index remained close to last month’s multiyear high, indicating continued significant input price increases, and the prices received index remained elevated. Looking ahead, firms were more optimistic about the six-month outlook than they were last month.

Business Activity Continues to Expand

Manufacturing firms in New York State reported that business activity expanded at a faster pace than in May. The general business conditions index rose five points to 25.0, its highest level in several months. Thirty-eight percent of respondents reported that conditions had improved over the month, while 13 percent reported that conditions had worsened. The new orders index advanced five points to 21.3 and the shipments index rose four points to 23.5—readings that reflected strong growth. Unfilled orders increased, inventories edged higher, and delivery times continued to lengthen.

Hiring Picks Up

The index for number of employees climbed ten points to 19.0, its highest level thus far in 2018, pointing to
a pickup in employment levels. The average workweek index was little changed at 12.0, indicating an increase in hours worked. Price increases remained elevated. The prices paid index was little changed from last month’s multiyear high, and the prices received index held steady at 23.3, suggesting ongoing moderate selling price increases.

Firms More Optimistic

After slipping in April, optimism about the six-month outlook increased for a second consecutive month. The index for future business conditions climbed eight points to 38.9. Employment was expected to increase in the months ahead, and the indexes for future prices remained elevated. The capital expenditures index edged down two points to 27.1, and the technology spending index fell six points to 17.1.

New York Fed

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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell