By Maria Martinez

 

Factory activity in the U.S. central Atlantic improved but remained relatively flat in September, according to a survey from the Federal Reserve Bank of Richmond released Tuesday.

The Fifth District Survey of Manufacturing Activity's index rose to 0 in September from minus 8 in August. Economists polled by The Wall Street Journal expected the indicator to come in at minus 7.5.

The index signals that factory activity remained flat over the month, while negative readings indicate a contraction.

The index is compiled by surveying manufacturing firms across the Fifth Federal Reserve District, which includes the District of Columbia, Maryland, North Carolina, South Carolina, Virginia and most of West Virginia.

Two of the three component indexes which form the composite indicator improved: shipments and new orders.

The shipments index rose to 14 in September from minus 8 in August, while the new orders index went up to minus 11 from minus 20 the previous month. However, the third component, the employment index, fell to 0 from 11 in August.

The wage index also increased dramatically, surpassing its July and August levels, indicating that a large share of firms continue to report increasing wages.

There wasn't much indication of supply-chain relief since August, as the indexes for vendor lead time and backlog of orders remained steady, although both have improved dramatically since earlier this year, the Richmond Fed said.

On a positive note, the average growth rate of prices paid and prices received both decreased markedly in September, the report showed.

Manufacturers in the area are a bit more optimistic about business conditions in the next six months, with the index gauging short-term expectations rising to minus 7 from minus 10 in August.

 

Write to Maria Martinez at maria.martinez@wsj.com

 

(END) Dow Jones Newswires

September 27, 2022 10:34 ET (14:34 GMT)

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