NEW YORK – “Manufacturing activity in the central Atlantic region pulled back in December from positive territory after expanding during the previous seven months,” according to the monthly business activity survey conducted by the Federal Reserve Bank of Richmond. “All broad indicators of activity — shipments, new orders and employment — landed in negative territory. Most other indicators also suggested additional softness. Capacity utilization turned negative following seven months of improvement, while backlogs held steady. Vendor delivery times were virtually unchanged, while manufacturers reported slightly quicker growth in inventories.”
The manufacturing index declined to negative 4 in December from positive 1 in November.
Shipments reversed to negative 6 from positive 6, the Fed reported. Volume of new orders dropped to negative 4 from positive 3, while the backlog of orders index remained negative 12.
The capacity utilization index fell to negative 3 from positive 2, while the vendor lead time index slid to negative 2, from negative 1 the prior month. The number of employees index increased to negative 2 from negative 9, while the average workweek index was positive 2 after a negative 6 reading last month, and the wages index bounced to negative 2 from negative 5.
As for future outlook (six months from now), the shipments index was 29, up from 24 last month, while the volume of new orders index grew to 35 from 28, and backlog of orders climbed to 21 from 12. Capacity utilization rose to 25 from 23, the vendor lead time index grew to 11 from 3, the number of employees index rose to 2 from zero, while the average workweek index was at 14, off from 16 the previous month, and the wages index was 29, an increase from 24. The capital expenditures index was 23, up from 22 last month.
The finished goods inventories index rose to 14 from 12, while the raw materials index inched up to 11 from 10. The current trend in prices paid fell to 0.62 in December from 1.02 in November, while climbing to 0.28 from 0.22 for prices received. The expected trend for the next six months fell to 2.04 from 2.70 for prices paid, and to 0.69 from 1.35 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.
