Empire Manufacturing Survey Slumps To 22-Month Lows

After bouncing in February, Empire Manufacturing survey in March dropped back to its weakest since May 2017. Against expectations of a further bounce to 10.0, the data printed at 3.7.

New Orders slowed dramatically (weakest since May 2017)and the Average Workweek contracted for the first time since Nov 2016.

Alternatively, the index for number of employees climbed ten points to 13.8, pointing to an increase in employment levels, even if those workers are apparently working far less.

Meanwhile, in fresh trouble for profit margins, the prices paid index moved higher, rising seven points to 34.1, indicating a pickup in input price increases. Meanwhile, the prices received index fell five points to 18.1, suggesting that selling price increases slowed, and that profit margins will suffer as a result.

'Soft' survey data has been slumping since October and now the brief February bounce is fading fast.

And yet, despite the disappointing current print, optimism about the six-month outlook remains solid even if it was slightly lower than last month. The index for future business conditions edged down three points to 29.6. The indexes for future new orders and shipments were also somewhat below last month’s levels. Firms expected solid increases in employment and hours worked in the months ahead. The capital expenditures index was little changed at 28.3, and the technology spending index came in at 20.3.