Philadelphia Fed Mar Business Index Up To 12.5 From 10.2 In Feb
March 15 2012 - 10:44AM
Dow Jones News
Mid-Atlantic manufacturers see better business conditions this
month, although orders and shipments slowed sharply, according to a
report released Thursday by the Federal Reserve Bank of
Philadelphia.
The Philadelphia Fed said its index of general business activity
within the factory sector rose to 12.5 in March from 10.2 in
February. It is the highest reading since April 2011.
Economists surveyed by Dow Jones Newswires expected the latest
index to edge up to 10.5. Readings under zero denote contraction,
and above-zero readings denote expansion.
Within the Philly Fed survey, the subindexes weakened
significantly but still positive this month.
The new orders index fell to 3.3 from 11.7 in February while the
shipments index declined to 3.5 from 15.0.
The important hiring index rebounded to 6.8 this month after it
had fallen to 1.1 in February from 11.6 in January. The workweek
index dropped to 2.7 from 10.1 last month.
Price pressures eased this month. The prices-paid index fell to
18.7 in March from 38.7 in February, while the prices-received
index declined to 8.4 from 15.0 last month.
Earlier Thursday, the New York Fed reported factory activity in
New York state was expanding in March for the fourth consecutive
month, but--unlike in the Philly survey--cost pressures in that
region surged this month. Nationwide, the factory sector has been
one of the best performers in the economy.
Philadelphia manufacturers remain optimistic about the future.
The expectations index for business conditions over the next six
months stood at 32.9, little changed from 33.3 last month.
In a series of special questions, the Philly Fed asked
manufacturers about second-quarter production schedules. The survey
showed 59% expect to increase production, with 24.2% planning
increases of more than 5%. Another 23.1% expect to cut output next
quarter, with 14.1% planning cuts of more than 5%.
-By Kathleen Madigan, Dow Jones Newswires; 212-416-2466;
kathleen.madigan@dowjones.com