New York Factory Activity Gains Speed, with Shipments at a Four-Year High

Manufacturing activity in New York state expanded at a faster pace in July, with the headline business conditions index rising 9.9 points to 15.6. The new orders index surged 18.7 points to 22.2, while the shipments index jumped 15.8 points to 24.4, a four-year high. Unfilled orders were unchanged at 5.0, while inventories moved up 4.0 points to 4.0, indicating business inventories grew in July. Delivery times lengthened, with the index increasing 1.1 points to 13.0, and supply availability improved but remained negative, stepping up 3.9 points to -10.0.

Employment increased at a faster pace in July, with the index for the number of employees rising 1.8 points to 11.4. At the same time, the average employee workweek declined to 2.8 from 5.1, signaling a smaller increase in hours worked in July. The prices paid and prices received indices stepped down in July, moving from 61.0 to 52.3 and from 31.4 to 27.6, respectively.

In July, firms’ optimism regarding the future weakened slightly, with the future business activity index declining 2.2 points to 27.9. In the next six months, new orders are expected to rise at a slightly faster pace compared to the prior month at 33.2. The future employment index fell 6.5 points to 14.4, suggesting a slower anticipated pace of employment growth over the next six months. Meanwhile, input and selling prices are expected to rise at a slower pace, moving from 59.4 to 53.0 and from 51.6 to 41.9, respectively. Furthermore, capital spending plans strengthened in July, increasing from 10.9 to 15.0.