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Philly Fed Survey: Another Solid Advance in New Orders

September 21, 2017

Bottom Line: Manufacturing activity of mid-Atlantic based businesses beat expectations for the second month in a row. New orders advanced sharply. On an ISM-weighted basis the advance was even stronger from last month, though the overall level remained below the headline figure. This was stronger than Empire State Manufacturing Survey, 21.7% vs. 14.1% on a ISM weighted basis. Together, these early regional reports suggest solid gains for manufacturing.

The Philadelphia Fed Index ROSE by 4.9 points in September to 23.8%, compared with market expectations for 17.1%. This indicates that manufacturing activity in the mid-Atlantic region still expanded in the last month. On an ISM-weighted basis, the index rose less than the headline, indicating that the details were somewhat mixed compared to the headline figure.

New Orders expanded and accelerated sharply.

Shipments expanded and also accelerated sharply. Unfilled Orders accelerated sharply while Inventories dropped.

Employment increased moderately. This portends better factory job creation in the upcoming September payroll employment report.

Prices Paid accelerated sharply.

The 6-Month Outlook improved.

Article by Contingent Macro Advisors