The New York Federal Reserve’s January Empire State Manufacturing Survey fell 7.6 points from last month to 3.9, mirroring a sharp drop in the latest national PMI Index from the Institute for Supply Management and global index from IHS Markit. The index was still positive, indicating that manufacturing “grew slightly,” according to the Empire State survey (a reading above zero indicates expansion). Nevertheless, this is the lowest reading since 3.4 in May of 2017. The Future Conditions Index, reflecting sentiments six months into the future, fell to 17.8, its lowest reading since February 2016. These results may reflect growing uncertainty and concern from on-going trade tariffs, recent stock market volatility and the current federal government shutdown. The Empire State survey has now dropped 17.5 points in two months after registering 21.4 in November. All the sub-indices for the survey also fell, led by drops in New Orders (-9.9 points to 3.5), Number of Employees (-10.1 to 7.4) and Inventories (-14.7 to -7.6), however all indices remained in positive territory, with the exception of Unfilled Orders, Delivery Time and Inventories. See the full report here.
