Today’s report on manufacturing in the Philadelphia region showed a decline in General Business conditions compared to September (9.7 vs 12.8), but still managed to beat consensus expectations (5.0). What is noteworthy about this month’s headline reading, though, is that manufacturing activity has now been positive for three straight months. That’s the first time we have been able to say that since August 2015. What was most impressive about this month’s report, though, was the internals. As shown in the table to the right, besides Prices Paid and Prices Received, every other sub-sector showed a month/month increase in October. “New Orders” was especially positive as this reading rose to its highest level since November 2014.
This month’s report was succinctly summed up by the Philadelphia Fed: “Responses to the October Manufacturing Business Outlook Survey suggest continued improvement in the region’s manufacturing sector. Indexes for general activity, new orders, and shipments all indicated expansion this month. However, firms reported continued reductions in overall employment. Firms remained optimistic about increases in overall business activity over the next six months.”