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Philly Fed Report Beats Expectations

Index registered 4.2 in May and was expected to hit 7 this month, but rose instead to 18; future activity remains optimistic, though markers fall.

PHILADELPHIA – Manufacturing activity in the Philadelphia region jumped significantly in June, reaching 18 - up from 4.2 in May. The June reading is the highest since April 2005.

New orders rose 10 points, to the highest level since March 2006. Shipments dipped four points, but stayed positive.

Delivery times and unfilled orders stayed negative, but improved over March readings.

Sixty-two percent of firms indicated steady employment levels, with 21 percent indicating increases. The employment index dropped seven points, but remained positive.

Forty-one percent of firms reported higher input costs, but the prices paid index slipped three points. Nineteen percent of firms reported higher output costs, and the prices received index rose three points.

For the next six months, the outlook is optimistic, despite slipping future indicators. The future general activity index dropped from 30.8 in May to 16.7 in June. Future new orders fell 11 points, while future shipments rose three. The future employment index slipped seven points after a four-month high in May.

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