New York Manufacturing Index Rises Less Than Expected In December

(RTTNews) - While the Federal Reserve Bank of New York released a report on Monday showing that its index of regional manufacturing activity bounced back into positive territory in December, the bank said conditions for New York manufacturers were flat.

The New York Fed said its general business conditions index climbed to a positive 1.0 in December from a negative 2.2 in November. Economists had expected the index to climb to 4.5.

A positive reading indicates an increase in regional manufacturing activity, but the New York Fed said the index indicated that activity changed little over the month.

Peter Boockvar, chief market analyst at the Lindsey Group said, "While we should take note of the mediocre report in the NY region for a 3rd month, this index has had no correlation to the national ISM, which has been strong in the last few months."

"Thus, wait to see more regional surveys before drawing any conclusions," Boockvar added, with the Philadelphia Federal Reserve's regional manufacturing report due on Thursday.

The turnaround by the general business conditions index was partly due to a rebound by shipments, as the shipments index climbing to a positive 7.7 in December from a negative 0.5 in November.

The new orders index showed a more modest upward move and remained in negative territory, climbing to a negative 3.5 from a negative 5.5.

The New York Fed said labor market conditions remained weak, with the number of employees index holding at 0.0 for a second month in a row

Meanwhile, the unfilled orders index fell to a negative 24.1 in December from a negative 17.1 in November, and the inventories index tumbled to a negative 21.7 from a negative 1.3.

On the inflation front, the prices paid index dipped to 15.7 in December from 17.1 in November, while the prices received index climb to a positive 3.6 from a negative 4.0.

The New York Fed said the indexes for the six-month outlook remained fairly optimistic but fell compared to the previous month.

The future general business conditions index dipped to 35.7 in December from 37.5 in November, holding just below the highs displayed over the past several months.