The Philadelphia Fed’s Business Outlook Survey indicates that output in the mid-Atlantic regions accelerated in the latest month.
The Philly Fed index increased from 11.5 in October to 16.7 in November, topping the forecast by Bloomberg of 12.0 A reading of zero is a sign that production is neither increasing nor decreasing.
New orders and shipments improved, but there was little in the way of new employment. On the inflation front, prices received increased slightly to –1.5 as the lack of demand at the retail level makes it very difficult for companies to raise prices.
Companies are still optimistic going six months out as the future general activity index remained positive for the 11th consecutive month, but the index did decline from 39.8 in October to 36.8. Still, the level is near where we saw it over 5 years ago, which is an encouraging sign that manufacturing will continue to recover as companies re-stock.
However, the strength and length of the manufacturing recovery will depend heavily upon how strong demand comes back in the U.S.
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