Manufacturing Growth Shrank: Richmond Fed

Manufacturing activity in the central Atlantic region pulled back in September after expanding the previous seven months, according to the monthly business activity survey conducted by the Federal Reserve Bank of Richmond.

“The index of overall activity was pushed lower as shipments and employment edged into negative territory,” the Richmond Fed reported. “Other indicators also suggested softer activity. District contacts reported that the volume of new orders flattened, order backlogs turned negative, and delivery times held steady.”

Manufacturers reported flat growth in capacity utilization, while inventories grew at a slightly quicker pace.

The manufacturing index fell to negative 2 in September, down from 11 in August.

In a look at expectations six months from now, the shipments index rose to 38 from 7 last month, new orders jumped to 42 from 16, and the backlog of orders soared to 20 from negative 1.

Meanwhile, activity in the service sector remained weak in September, according to the Fed’s service-sector activity survey.

“A steep drop in big-ticket sales weighed down total retail sales, and shopper traffic continued to decline this month,” the Richmond Fed reported.

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