US: Philadelphia Fed Manufacturing Index improves to -10.4 in May vs -19.8 expected
- Philadelphia Fed Manufacturing Index came in better than expected in May.
- US Dollar Index rises to fresh monthly highs above 103.20.
The diffusion index for current general activity of the Federal Reserve Bank of Philadelphia's Manufacturing Survey rose to -10.4 in May from the three-year low of -31.3 reported in April and was above the market expectation of -19.8.
Key takeaways from the report:
Manufacturing activity in the region continued to decline overall, according to the firms responding to the May Manufacturing Business Outlook Survey. The survey’s indicators for general activity, new orders, and shipments rose from last month but remained negative.
The indexes for new orders and shipments both increased for the second consecutive month but remained negative. The index for current new orders rose 14 points to -8.9, and the current shipments index edged up 3 points to -4.7.
On balance, the firms also reported a decline in employment. The price indexes remained below long-run averages, with the prices received index declining further. The survey’s future indexes continued to reflect muted expectations for growth over the next six months.
The employment index fell from -0.2 to -8.6, the index’s third consecutive negative reading. Over 15 percent of the firms reported a decrease in employment, and 7 percent reported an increase; most firms (76 percent) reported no change. The average workweek index was little changed at ‑7.7.
The prices paid diffusion index ticked up 3 points to 10.9, after reaching a near three-year low last month. Over one-quarter of the firms reported increases in input prices, and 15 percent reported decreases; 59 percent reported no change. The current prices received index fell 4 points to -7.0, its fourth consecutive decline and lowest reading since April 2020.
The diffusion index for future general activity declined 9 points to -10.3, the index’s third consecutive negative reading.
Market reaction
The Greenback gained momentum after the release of Jobless Claims and the Philly Fed, hitting fresh daily highs versus its main rivals. The DXY trades at monthly highs above 103.20. The April Existing Home Sales report is scheduled to be released later on Thursday.
Author
Matías Salord
FXStreet
Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.
