The latest survey from the Federal Reserve Bank of Richmond revealed that
the U.S. fifth district's manufacturing activity continued to contract in early
January, albeit at a quicker pace than in the previous month.
According to the survey, the composite manufacturing index fell from -11
in December 2023 to -15 in January 2024. This was the weakest reading since
February 2023 (-16).
According to the report, the deeper decline in the headline index in January
reflected steeper decreases in such components as new orders (to -16 in January from -14
in December) and employment (to -15 from -1). Meanwhile, the third major component - shipments
- reduced at a slightly softer pace (-15, compared to -17 in December).
In other survey results, the measure of backlog of orders (-23, compared
to -17 in December) remained negative in December, while vendor lead time gauge
(-3, compared to +1) returned into decreasing territory after one-month advance,
and capacity utilization indicator (-27, compared to -8) slipped further in contraction
territory.
On the price front, the average growth rates of prices
paid (4.19, down from 4.24 in December) and prices received (2.80, up from 2.79)
were nearly unchanged in January.