Prices paid remain elevated, while business activity improved, the Empire State Manufacturing Survey, released Monday by the Federal Reserve Bank of New York, suggested.

“The prices paid index rose to its highest level in several years, indicating significant input price increases, and the prices received index remained elevated,” the report said. “Looking ahead, firms were somewhat more optimistic about the six-month outlook than they were in April, though less so than earlier this year.”

The general business conditions index rose to 20.1 in May from 15.8 in April.

Empire State Manufacturing Survey

Economists surveyed by IFR Markets had expected the index would be 15.0.

The new orders index soared to 16.0 from 9.0, while the shipments index gained to 19.1 from 17.5, and unfilled orders increased to 5.0 from 3.7, the Fed said.

The delivery time index slipped to 13.7 from 15.6, while the inventories index crept to 10.1 from 8.1 in the prior survey. The prices paid index rose to 54.0 from 47.4, while the prices received index rose to 23.0 from 20.7. The number of employees index increased to 8.7 from 6.0, while the average employee workweek index dropped to 11.1 from 16.9, the Fed reported.

Looking six months into the future, the general business conditions index surged to 31.1 from 18.3 last month. The new orders index increased to 33.7 from 18.5, while the shipments index jumped to 36.5 from 18.5, and unfilled orders reversed to negative 2.2 from positive 2.2, the Fed said. The delivery time index rebounded to positive 3.6 from negative 0.7, while the inventories index climbed to 8.6 from 8.1.

The prices paid index dipped to 54.0 from 54.8, while the prices received index slid to 29.5 from 31.1. The number of employees index grew to 20.8 from 13.1 while the average employee workweek index gained to 4.3 from 3.7, the Fed reported. The capital expenditures index increased to 29.5 from 25.2. The technology spending index rose to 23.0 from 18.5.

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Gary Siegel

Gary Siegel

Gary Siegel has been at The Bond Buyer since 1989, currently covering economic indicators and the Federal Reserve system.