Recent Updates

  • US: Wholesale Trade (Feb), Producer Prices (Mar)
  • US: Producer Price Indexes by Commodity Detail (Mar)
  • US: Producer Price Indexes by Industry Detail (Mar)
  • Canada: Investment in Building Construction (Feb), Labor Force Survey (Mar)
  • more updates...

Economy in Brief

Empire State Factory Sector Index Turns Slightly Negative
by Tom Moeller  April 15, 2015

The Empire State Factory Index of General Business Conditions declined to -1.19 during April after slipping to 6.90 in March. The figure, from the Federal Reserve Bank of New York, was the first negative reading since December and remained well below the 27.41 peak reached last September. The latest fell well short of expectations for 6.8 in the Action Economics Forecast Survey.

Based on these figures, Haver Analytics calculates a seasonally adjusted index that is compatible to the ISM series. The adjusted figure held steady m/m at 51.7 but was below the June peak of 55.4. A rising level of activity is indicated by a figure above 50. Since inception in 2001, the business conditions index has had a 68% correlation with the quarterly change in real GDP.

Movement in the component series was mixed last month. The weakest reading was employment which backpedaled into negative territory. During the last ten years, there has been a 71% correlation between the index level and the m/m change in factory sector payrolls. Also remaining negative were the new orders, unfilled orders, average workweek and delivery times figures. Improvement was evident in shipments and inventories.

The prices paid index rose to its highest level since September. Twenty four percent of respondents reported paying higher prices while five percent realized lower prices. During the last ten years, there has been a 70% correlation between the index and the 3-month change in the intermediate goods PPI.

Looking ahead, the Empire State index of expected business conditions in six months improved to 37.06, the highest level in three months. Inventories, new orders, shipments, delivery times, capital spending and prices paid led the gain, offset by employment, unfilled orders and the average workweek.

The Empire State figures are diffusion indexes which are calculated by subtracting the percent of respondents reporting poorer business conditions from those reporting improvement. Thus, they have a good correlation with growth in the series covered. The data is available in Haver's SURVEYS database. The ISM-adjusted headline index is calculated by Haver Analytics. The series date back only to 2001. The Consensus expectation figure can be found in Haver's AS1REPNA database.

Empire State Manufacturing Survey Apr Mar Feb Apr'14 2014 2013 2012
General Business Conditions (ISM Adjusted) 51.7 51.7 52.4 50.3 52.4 50.0 51.8
General Business Conditions (Diffusion Index, %) -1.19 6.90 7.78 3.49 11.83 3.87 4.22
 New Orders -6.00 -2.39 1.22 -0.94 7.89 1.16 1.46
 Shipments 15.23 7.93 14.12 7.72 12.09 4.52 11.20
 Unfilled Orders -11.70 -13.40 -6.74 -13.27 -9.03 -8.74 -8.83
 Delivery Time -4.26 -2.06 1.12 -9.18 -5.17 -3.52 -0.30
 Inventories 2.13 -5.15 -2.25 -3.06 -1.80 -5.73 -2.91
 Number of Employees 9.57 18.56 10.11 8.16 10.85 3.73 8.62
 Prices Paid 19.15 12.37 14.61 22.45 20.90 21.53 24.71
large image