Manufacturing activity in New York state continues to soften

“Manufacturing conditions remained somewhat sluggish in New York State in July, though orders held steady and shipments edged slightly higher,” commented New York Fed economic research advisor Richard Deitz. “Employment continued to contract, and capital spending plans were weak. However, firms remained fairly optimistic that conditions would improve in the months ahead.”

The new orders index remained flat for the second consecutive month, according to the survey, while the inventories index indicated lower inventories following three months of stability. Firms remain optimistic for future business conditions, as 41% of respondents expect improvement over the next six months. The full release is available here.

Last year, the Index peaked at 10.8 in June and has only indicated business condition improvements for eight months out of the last two-plus years.

On a three-month moving average basis (3MMA) the Index rose to -9.40 through July, now the least-negative reading of the year (Figure 1). Recall that in March the Index had reached -22.33, the fourth-lowest 3MMA figure within our 15-year data history, which was only higher than the months of April, May, and June 2020.

An interactive history of the Empire State Manufacturing Index is available here on our website.