Global| Mar 21 2017Philadelphia Fed Nonmanufacturing Business Conditions Ease
by:Tom Moeller
|in:Economy in Brief
Summary
The Federal Reserve Bank of Philadelphia's Nonmanufacturing Business Index of current conditions in March fell to 32.5 from 38.0 during February. Despite the monthly decline, the index improved versus the averages for 2016 and 2015. [...]
The Federal Reserve Bank of Philadelphia's Nonmanufacturing Business Index of current conditions in March fell to 32.5 from 38.0 during February. Despite the monthly decline, the index improved versus the averages for 2016 and 2015. Forty-nine percent of respondents reported an increase in current activity, while sixteen reported less. The expectations index at the company level for March declined to 53.8, a three-month low.
The new orders index eased for a second month, but remained up y/y. The sales/revenues index similarly declined, but was roughly stable y/y. The inventories index eased for a third straight month. On the employment front, the index of full-time permanent employees improved following the February decline, while the index for part-time or temporary employment similarly gained m/m. Wage & benefit cost gains plummeted to the lowest level in twelve months. The average employee workweek index held roughly steady following the prior month's decline. The capital expenditures reading on physical plant as well as equipment & software both weakened sharply.
The index for prices paid improved slightly. The index of prices received fell further below zero, negative for the second time since 2012.
The Philadelphia Fed figures are diffusion indexes which are calculated by subtracting the percent of respondents reporting poorer business conditions from those reporting improvement. So, readings above zero indicate more positive than negative responses. These indexes have a good correlation with growth in the series covered. The data are available in Haver's SURVEYS database.
| Federal Reserve Bank of Philadelphia: Nonmanufacturing Business Outlook Survey (Diffusion Index, SA) | Mar | Feb | Jan | Mar'16 | 2016 | 2015 | 2014 |
|---|---|---|---|---|---|---|---|
| General Activity - Company | 32.5 | 38.0 | 33.3 | 18.2 | 19.7 | 31.3 | 38.7 |
| New Orders | 22.6 | 25.3 | 28.9 | 18.3 | 15.6 | 21.7 | 27.9 |
| Sales or Revenue | 20.3 | 32.5 | 43.5 | 19.3 | 16.1 | 23.6 | 30.2 |
| Inventories | 4.6 | 5.7 | 10.4 | 7.6 | 4.4 | 5.2 | 5.8 |
| Number of Full-Time Permanent Employees | 17.2 | 12.4 | 19.5 | 8.4 | 11.7 | 15.5 | 17.3 |
| Prices Paid | 18.0 | 15.3 | 29.5 | 8.4 | 17.5 | 19.2 | 19.7 |
| Expected General Activity - Company | 53.8 | 57.5 | 68.3 | 45.4 | 36.1 | 53.8 | 59.9 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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