Research >> Economics
Richmond Fed's Current Activity Index lost 1 point to a reading of 6
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Fifth District manufacturing activity expanded at a modest pace in January, according to the most recent survey by the Federal Reserve Bank of Richmond. Shipments increased at a faster pace this month, while the volume of new orders remained steady. Manufacturing employment and average wages grew at a slower pace this month. However, the average workweek grew more quickly.
Manufacturers were optimistic about future business conditions. Firms expected faster growth in shipments and new orders in the six months ahead. Additionally, survey participants expected order backlogs to increase and anticipated faster growth in capacity utilization. Expectations were for little change in vendor lead times.
Producers expected faster growth in hiring in the months ahead. They also expected solid growth in average wages and a pickup in the average workweek.
Prices of raw materials and finished goods rose at a slower pace compared to last month. Survey participants expected faster growth in prices paid and prices received over the next six months.
Overall, manufacturing activity increased at a modest pace. The January composite index for manufacturing moved down one point to a reading of 6. The index for shipments advanced five points to end at a reading of 10. The index for new orders grew at the same pace as a month ago, finishing at a reading of 4. Manufacturing employment grew at a slower pace this month, pulling the index down eight points to finish at 5.
Capacity utilization increased in January. The index gained 14 points from December's reading to finish at an index of 9. Vendor lead times lengthened compared to a month ago, moving the index up three points to a reading of 5. Backlogs dropped this month. The indicator lost four points to settle at −9. Finished goods inventories rose more quickly compared to a month ago. That index added three points to end at 25. Additionally, raw materials inventories growth remained solid this month. That gauge moved to 19 from 20.
Posted: January 27, 2015 Tuesday 10:00 AM