The New York Federal Reserve announced on Tuesday that its latest Empire
State Manufacturing Survey found that manufacturing activity in the New York State
shrank sharply in early January 2024, hitting a 44-month low.
According to the survey, the NY Fed Empire State manufacturing index plunged
from -14.5 in December 2023 to -43.7 early this month, pointing to the steepest
decline in business activity in the New York region’s manufacturing sector
since May 2020.
Economists had predicted the index to increase to -5.0.
Anything below zero signals contraction.
According to the report, the new orders index tumbled
38.1 points to -49.4, pointing to a significant decline in orders in January,
while the shipments index plummeted 24.9 points to -31.3, indicating a large fall
in shipments. Elsewhere, the unfilled orders index slipped 0.2 point to -24.2,
signalling a continued drastic decrease in unfilled orders. The inventories
index dropped 2.2 points to -7.4, pointing to a modest fall in inventories. Meanwhile,
the employment index increased 1.5 points to -6.9, pointing to a
slight reduction in employment levels. The delivery times index climbed 7.2
points to -8.4 but remained below zero, indicating shorter delivery times. On the
price front, the prices paid index jumped 6.5 points to 23.2 in January, signalling
a small rebound in input price gains, while the prices received index decreased
2.0 points to 9.5, indicating that selling price advances remained moderate.