June Philadelphia Fed index shows slower growth, rising costs
Manufacturers report continued growth in June, and the Federal Reserve Bank of Philadelphia Report on Business respondents reported increasing costs.
The region's manufacturing sector expanded in June, at a slower pace than in May, as the general business conditions index decreased to 19.9 from 34.4.
Economists surveyed by IFR Markets predicted a reading of 28.8 for the index.
The prices paid index was 51.8, down from 52.6 last month, new orders index slumped to 17.9 from 40.6, shipments gained to 28.7 from 25.8, the unfilled orders index dropped to negative 2.7 from positive 15.3, the delivery times index slid to 9.6 from 18.5, inventories rose to 10.2 from 8.1, prices received slipped to 33.2 from 36.4, the number of employees index grew to 30.4 from 30.2, and the average employee workweek fell to 24.2 from 34.4.
“The firms continued to report higher prices for both purchased inputs and their own manufactured goods, although the survey’s price indicators fell modestly from their May readings,” according to the report. “Price increases for purchased inputs were reported by 54 percent of the manufacturers this month, but the prices paid diffusion index edged 1 point lower. The current prices received index, reflecting the manufacturers’ own prices, decreased 3 points but remains at a high reading of 33.2. Nearly 34 percent of the firms reported higher prices for their manufactured goods.”
The six months from now general business conditions index fell to 34.8 from 38.7 in last month’s survey, the prices paid index was at 62.6, off from 63.4 in the prior survey, and the prices received index surged to 56.6 from 33.6. The capital expenditures index rose to 36.5 from 21.6 last month. The number of employees index declined to 34.1 from 42.8, while the average workweek index increased to 14.1 from 10.1. The new orders index slid to 38.2 from 40.3, shipments fell to 37.0 from 46.8; and the unfilled orders index climbed to 17.2 from 9.4. The delivery times index fell to 1.5 from 7.5, and inventories gained to 17.2 from 14.8.