New York Manufacturing Index Tumbles To Six-Year Low In August

(RTTNews) - Business activity for New York manufacturers unexpectedly declined in the month of August, according to a report released by the Federal Reserve Bank of New York on Monday, with the index of regional manufacturing activity falling to a six-year low.

The New York Fed said its general business conditions index tumbled to a negative 14.9 in August from a positive 3.9 in July, with a negative reading indicating a contraction in manufacturing activity.

The sharp drop came as a surprise to economists, who had expected the index to climb to a positive reading of 4.8.

With the unexpected decrease, the general business conditions index fell to its lowest level since hitting a negative 19.4 in April of 2009.

The steep drop by the headline index came as the new orders index slumped to a negative 15.7 in August from a negative 3.5 in July.

The shipments index also plunged to a negative 13.8 in August from a positive 7.9 in July, indicating a downturn in shipments.

The report also said the number of employees index dipped to 1.8 in August from 3.2 in July, although the positive reading still points to job growth.

The prices paid index edged down to 7.3 in August from 7.5 in July, while the prices received index dropped to 0.9 from 5.3.

Looking ahead, however, the New York Fed said the indexes for future activity still showed a fair degree of optimism about the six-month outlook.

The index for future business activity climbed to 33.6 in August from 27.0 in July but remained below the higher levels recorded throughout 2014.

Thursday morning, the Philadelphia Fed is scheduled to release a separate report on regional manufacturing activity. The Philly Fed Index is expected to rise to 7.5 in August from 5.7 in July.