Richmond Fed: Manufacturing Growth Stronger

Manufacturing activity in the central Atlantic region "continued to improve" in August, according to the monthly business activity survey conducted by the Federal Reserve Bank of Richmond, as the manufacturing index rose to 12 in August from 7in July.

Index readings above zero show expansion, while numbers below zero indicate contraction.

Shipments jumped to 10 from 3 the Fed reported. Volume of new orders rose to 13 from 5, while the backlog of orders index increased to 15 from zero.

The capacity utilization index grew to 17 from 4, while the vendor lead time index gained to 16 from 12. The number of employees index slid to 11 from 13, while the average workweek index was at 8 after a 3 reading last month, and the wages index fell to 11 from 16.

As for future outlook (six months from now), the shipments index was 43, up from 36 last month, while the volume of new orders index climbed to 47 from 34, and backlog of orders rose to 29 from 15. Capacity utilization gained to 35 from 29, the vendor lead time index rose to 8 from 6, the number of employees index dipped to 18 from 19, while the average workweek index was at 10, unchanged from 10 the previous month, and the wages index was 28, after 23 last month. The capital expenditures index was 27 after 19 last month.

The finished goods inventories index gained to 16 from 12, while the raw materials index fell to 17 from 21 the previous month.

The current trend in prices paid dropped to 1.39 in August from 1.99 in July, while falling to 0.76 from 0.99 for prices received. The expected trend for the next six months grew to 2.05 from 1.89 for prices paid, and increased to 1.34 from 1.04 for prices received.

All firms surveyed are located within the Fifth Federal Reserve District, which includes the District of Columbia, Maryland, North Carolina, South Carolina, Virginia, and most of West Virginia.

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