Philadelphia District Factory Activity Unexpectedly Expands — Philadelphia Fed

By Ed Frankl

Manufacturing activity in the Philadelphia area expanded a little this month, an unexpectedly positive result as expectations became more widespread of future growth.

The Federal Reserve Bank of Philadelphia said Thursday that its index for business activity rose to 1.7 in September, from minus 7.0 in August. That beat expectations that the index would rise to a still-negative minus 1.1, from a consensus of economists polled by The Wall Street Journal.

It means August's reading was the only negative one--indicating contracting activity--since January.

The Philadelphia Fed survey polls manufacturers in the Third Federal Reserve District, which covers eastern Pennsylvania, southern New Jersey and Delaware.

Nearly 22% of firms surveyed reported increases in general activity this month, while 20% reported decreases and 51% reported no change.

But while the index of employment rose, suggesting increases in employment overall, indexes for new orders and shipments declined and turned negative, the Philly Fed said.

However, firms continue to expect growth over the next six months, with expectations more widespread this month, it added.

However, in a warning to the Federal Reserve, which Wednesday cut interest rates by a half-point, price indexes moved higher and continue to indicate overall increases in prices, the survey noted.

Write to Ed Frankl at edward.frankl@wsj.com

(END) Dow Jones Newswires

September 19, 2024 08:59 ET (12:59 GMT)

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