Following on a string of recent stronger than expected data in the manufacturing sector, today’s release of the Philadelphia Fed Manufacturing survey showed a surge for March. While economists were forecasting the headline index to come in at a level of -1.5, the actual reading came in at +12.4. That was the first positive reading since August, the highest reading since last February, the largest monthly increase since November 2014, and the strongest report relative to expectations since November 2014. Concerns about weakness in the manufacturing sector that were so persistent in the beginning of the year are becoming more and more scarce by the day.
While the surge in the headline reading for the Philly Fed report was impressive, the internals were even more so. The table to the right lists the m/m change for each category. You may recall that last month, every component of the report besides the top line headline reading declined. This month, nearly the opposite happened. As shown in the table, every component increased this month, and some by a lot. New Orders, for example, surged 21 points which is the largest monthly increase since October 2005! Shipments haven’t seen such a large monthly increase since March 2014, and the last time every component of the Philly Fed report increased on a month to month basis was back in August 2009.