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Philly Fed: Continued Sharp Decline

March 16, 2023
Bottom Line: The New York Fed's Empire Manufacturing Index remained deeply in contraction territory in February as new orders continued to decline. Shipments were sharply lower, as were unfilled orders.  Employment, which had been holding up in this sector and across manufacturing more broadly, fell sharply. Overall, manufacturing remains very weak and was continuing to decline in the first half of March. Increasingly the contraction in manufacturing suggests that US goods consumption has turned sharply lower.
The Philadelphia Fed Manufacturing Index
ROSE 1.1 points to -23.2, BELOW the 3-Month average of -18.8, BELOW the 6-Month average of -15.45, and -46.4 BELOW the year-ago level.  On an ISM-weighted basis the index FELL -20.2 points to -21.6, BELOW the 3-Month average of -7.37, BELOW the 6-Month average of -5.3, and -47.6 BELOW the year-ago level.
  • New Orders FELL -14.6 points to -28.2, BELOW the 3-Month average of -17.57, BELOW the 6-Month average of -17.62, and -50.5 BELOW the year-ago level.  
  • Shipments FELL -34.1 points to -25.4, BELOW the 3-Month average of -1.87, BELOW the 6-Month average of 1.03, and -51.4 BELOW the year-ago level.  
  • Unfilled Orders FELL -4.3 points to -21.3, BELOW the 3-Month average of -19.17, BELOW the 6-Month average of -18.4, and -37.5 BELOW the year-ago level.  
  • Delivery Time FELL -10.7 points to -24.3, BELOW the 3-Month average of -14.5, BELOW the 6-Month average of -10.77, and -59.6 BELOW the year-ago level.  
  • Inventories FELL -26.5 points to -11.2, BELOW the 3-Month average of 1.67, BELOW the 6-Month average of -1.08, and -13.8 BELOW the year-ago level.  
  • Prices Paid FELL -3 points to 23.5, BELOW the 3-Month average of 24.83, BELOW the 6-Month average of 32.35, and -49.9 BELOW the year-ago level.  
  • Employment FELL -15.4 points to -10.3, BELOW the 3-Month average of 1.9, BELOW the 6-Month average of 7.33, and -46.8 BELOW the year-ago level.  
  • Future Activity Index FELL -9.7 points to -8, BELOW the 3-Month average of -0.47, BELOW the 6-Month average of -3.77, and -27.5 BELOW the year-ago level.  
  • Future Capital Expenditures FELL -11.3 points to -3.8, BELOW the 3-Month average of 4.73, BELOW the 6-Month average of 7.48, and -27.4 BELOW the year-ago level.

Article by Contingent Macro