Philadelphia Manufacturing Surges, New York Strong on Optimism
Growth at manufacturers in the Philadelphia region and New York state and rebounded in April, reflecting stronger orders and increased shipments as the economy continues its recovery from the Covid-19 pandemic.
The Federal Reserve Bank of Philadelphia’s general activity index surged to 50.2 -- the highest since April 1973 -- from a revised 44.5 in March, according to a report Thursday. That exceeded all forecasts in a Bloomberg survey of economists whose median projection called for a reading of 41.5. Readings above zero indicate expansion.
A separate report from the Federal Reserve Bank of New York’s general business conditions index advanced at the fastest pace since 2017, rising to 26.3 from 17.4 a month earlier. The median forecast in a Bloomberg survey called for a reading of 20.
Almost 59% of Philadelphia-area firms reported increases in current activity this month, while only 8% reported decreases, the regional bank said. The index for current shipments increased, while the current employment gauge surged to 30.8, a record high.
Companies continue to report price pressures from purchased inputs, according to the report. While the prices-paid index edged a little lower from March’s 40-year high to 69.1 in April, more than 71% of the firms reported higher input prices this month.
In New York state, prices paid for materials increased 10.3 points to 74.7, the highest since July 2008. Meantime, a gauge of prices received climbed to 34.9, the strongest reading in data back to 2001.
Delivery times also lengthened, with the gauge rising to a record, and unfilled orders increased to the highest since 2001 as supply chains.
As a result, factory hiring and average workweek are picking up.
The Fed bank’s report also showed the state’s manufacturers were upbeat about prospects for business activity and orders.
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