Recent Updates

  • Poland: Employment & Wages (Feb-Prelim)
  • Hong Kong: Labor Force Survey (Feb)
  • Switzerland: International Trade (Feb)
  • Germany: Foreign Trade Revisions, Unfilled Orders (Jan)
  • Lithuania: PPI (Feb-Final)
  • Hungary: BOP (Jan)
  • Albania: Trade by Country (Feb)
  • Turkey: Foreign Trade Indexes (Jan)
  • Philippines: International Reserves (Feb)
  • more updates...

Economy in Brief

Philadelphia Fed Index Improved Slightly
by Tom Moeller November 16, 2006

The Philadelphia Federal Reserve Bank's Index of General Business Conditions in the manufacturing sector matched expectations and improved slightly in November after two months in negative territory. At 5.1, the figure compares with -0.7 and -0.4 during October & September but remained well below the average of 12.0 during the prior eight months.

During the last ten years there has been a 65% correlation between the level of the Philadelphia Fed Business Conditions Index and three month growth in factory sector industrial production. There has been a 43% correlation with q/q growth in real GDP.

The sub indexes for shipments, unfilled orders, delivery times and the workweek each improved moderately, however, new orders and inventories fell. In addition, the employment index fell to near zero. During the last ten years there has been a 75% correlation between the employment index and the three month growth in factory payrolls.

The business conditions index reflects a separate survey question, not the sub indexes.

The prices paid index fell for the eighth month this year to the lowest level since March. During the last ten years there has been a 76% correlation between the prices paid index and the three month growth in the intermediate goods PPI. There has been an 85% correlation with the change in core intermediate goods prices.

The separate index of expected business conditions in six months fell and retraced one quarter of the prior month's improvement.

The latest Business Outlook survey from the Philadelphia Federal Reserve Bank can be found here.

Today's comments by Chicago Federal Reserve Bank President Michael H. Moskow can be found here.

Philadelphia Fed Business Outlook November October Nov. '05 2005 2004 2003
General Activity Index 5.1 -0.7 10.7 12.4 28.0 10.5
Prices Paid Index 26.7 32.0 55.1 43.5 51.2 16.8
large image