Mid-Atlantic manufacturers reported better business conditions
this month, according to a survey released Thursday by the Federal
Reserve Bank of Philadelphia. Optimism jumped as did the costs of
inputs.
The Philadelphia Fed's index of general business activity
covering the regional factory sector unexpectedly increased to 17.8
in June from 15.4 in May.
Economists surveyed by the Wall Street Journal expected the
latest index to slow to 13.3. Readings under zero denote
contraction, and above-zero readings denote expansion.
On Monday, the New York Fed said manufacturing in its state
remains quite strong this month, with new orders at a four-year
high.
Taken together, the reports suggest factory output in the
Northeast continues to grow this month. A rebound in manufacturing
output nationwide would help economic growth this quarter after the
economy contracted in the first quarter. Earlier Thursday, the
Labor Department said jobless claims fell 6,000 to 312,000 last
week.
Within the Philadelphia Fed survey, the subindexes generally are
improving this month.
The new orders index rose to 16.8 from 10.5 in May. The
shipments index edged up to 15.5 from 14.2.
The employees index advanced to 11.9 in June from 7.8 last
month. The workweek index jumped to 7.3 from 2.9.
Philadelphia area manufacturers report vastly higher cost
pressures. The prices-paid index jumped to 35.0 from 23.0 in May
which was more than double April's 11.3 reading. The
prices-received index slowed to 14.1 after it jumped to 17.0 from
4.3 in April.
Philadelphia manufacturers are much more optimistic about the
next six months.
The general business expectations index jumped to 52.0 in June
from 37.4 in May. It was the highest reading since October
2013.
The employment index increased to 31.4 from 24.1 last month.
Write to Kathleen Madigan at kathleen.madigan@wsj.com
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