The Empire State Index of General Business Conditions in New York's manufacturing industries for October fell unexpectedly to 12.08 from a downwardly revised 15.58 in September. Consensus expectations had been for improvement to 19.0.

Since the series' inception in 2001 there has been a close 80% correlation between the index level and the three month change in factory sector production.

Lower shipments and employment indexes figured largely in the October report, although the new orders index recovered more than half of the prior month's sharp decline. Prices paid rose to near the record high levels of late last year.

Like the Philadelphia Fed Index of General Business Conditions, the Empire State Business Conditions Index reflects answers to an independent survey question; it is not a weighted combination of the components.

The index of expectations for business conditions in six months fell to the lowest level since 2001 and expectations for future capital spending fell slightly.

The Empire State Manufacturing Survey is a monthly survey of manufacturers in New York State conducted by the Federal Reserve Bank of New York. Participants from across the state in a variety of industries respond to a questionnaire and report the change in a variety of indicators from the previous month. Respondents also state the likely direction of these same indicators six months ahead. April 2002 is the first report, although survey data date back to July 2001.

For more on the Empire State Manufacturing Survey, including methodologies and the latest report, click here.