“Manufacturing activity in the central Atlantic region expanded for the fourth straight month,” according to the monthly business activity survey conducted by the Federal Reserve Bank of Richmond.
“Looking at the main components of activity, shipments edged slightly higher, while new orders inched lower and employment grew more slowly. Other indicators were also mixed but suggested continued solid activity.”
“Backlogs continued their upward trend and capacity utilization matched its all time high reading seen in April,” the Richmond Fed said. “Vendor lead-time continued to grow at a solid pace, suggesting activity remained strong in May. Inventories grew at a somewhat slower pace.”
The manufacturing index decreased to 26 in May from 30 in April. Shipments improved to 32 from 30. Volume of new orders declined to 36 from 41, while the backlog of orders index gained to 16 from 5.
The capacity utilization index stayed at 27, while the vendor lead time index slid to 14, down from 17 in March. The number of employees index decreased to 4 from 13, while the average workweek index declined to 13 from 16 reading, and the wages index climbed to 20 from 6.
As for the future outlook six months from now, the shipments index was 55, up from 46, while the volume of new orders index jumped to 50 from 44 and the backlog of orders fell to 19 from 25.