Mid-Atlantic Manufacturing Activity Still Struggling to Rebound, Richmond Fed Says

By Joshua Kirby

Factory activity slumped more sharply in the U.S. mid-Atlantic region this month, suggesting manufacturers are still struggling under high interest rates.

The Fifth District Survey of Manufacturing Activity's index for September edged down to minus 21 from minus 19 in August, hitting the worst reading since the pandemic days of mid-2020.

A reading of zero in the index represents an equal number of firms reporting increases and decreases in activity, meaning a negative reading marks a more negative result across respondents.

There was sign of some recovery in demand, with the index of new orders climbing to minus 23 from minus 26. However, the gauge of employment dropped sharply, to minus 22 from minus 15 previously, pointing to a tightening in the jobs market.

It suggests manufacturing firms are yet to see the benefit of easing borrowing costs after the Federal Reserve moved to cut its main interest rate by a half-point last week.

The index is compiled by surveying 70 to 80 manufacturing firms across the Fifth Federal Reserve District, which comprises the District of Columbia, Maryland, North Carolina, South Carolina, Virginia and most of West Virginia.

Write to Joshua Kirby at joshua.kirby@wsj.com; @joshualeokirby

(END) Dow Jones Newswires

September 24, 2024 10:43 ET (14:43 GMT)

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