July NY Manufacturing Activity Up

Manufacturers in the region still see higher costs, but employment and production levels were up.

NEW YORK (Dow Jones/AP) - Manufacturing activity in the New York Federal Reserve district increased further in July with the overall index increasing to a reading of 26.46 from an unrevised 25.75 in June.

The New York Fed's manufacturing index covers New York state, not the N.Y. Fed's district, which also includes part of New Jersey.

Among the economists who forecast this index, the median expectation of 12 economists surveyed by Dow Jones Newswires was for a reading of 17.75.

The bank said Monday in its Empire State Manufacturing Survey that ''conditions for New York manufacturers continued to improve in July.''

The July reading for the new orders index increased to 26.52 compared with 17.19 in June, while the shipments index eased to a still-high 26.19 from 29.80.

The unfilled orders index, however, moved back into positive territory, with a reading of 2.47 compared with a negative reading of minus-2.13 in June. Inventories, meanwhile, moved sharply into negative territory, with a negative reading of minus-19.75 from a reading of 3.19 in June.

The prices paid index decreased to a reading of 34.57 in July from 42.55, while the prices received index slipped to a reading of 8.64 from 9.57 in June, showing that manufacturers are still facing higher costs that they are having somewhat more difficulty in passing on in the form of higher prices.

The employment indexes improved. The number of employees increased to a reading of 11.39 from 3.37, while the average employee workweek increased to a reading of 6.17 from 3.19 in June.

The index measuring expectations six months from now improved to a reading of 48.24 from 44.14 in June.

In a series of supplementary questions, manufacturers were asked how much their expectations had changed from the first half of 2006 to the first half or 2007 and what their expectations were for the full year. In the current survey, the median sales increase was 6 percent for both the first half of 2007 and the full year. The median change in employment was unchanged for the first half or 2007, but up 2 percent for the full year.