The numbers: The New York Fed’s Empire State business-conditions index, a gauge of manufacturing activity in the state, rebounded 41 points in February, but stayed below the breakeven rate at negative 2.4, the regional Fed bank said Thursday. That’s the third straight month in negative territory.
The index had fallen 53 points in the prior two months.
The gain was larger than expected. Economists had expected a reading of negative 13.5 in February, according to a survey of economists by the Wall Street Journal.
A separate reading from the Philadelphia Fed showed manufacturing index accelerated to a reading of 5.2 in February from negative 10.6 in the prior month. Economists had expected a reading of negative 9, according to the Wall Street Journal survey. This was the first positive reading in the index since August.
Any reading above zero indicates improving conditions.
Key details: In the Empire State survey, the index for new orders rose 43.1 points to negative 6.3 in February. The shipments index jumped 34.1 points to 2.8.
The pace of input price increases in the New York region picked up for the second straight month and the pace of selling prices also steepened.
Optimism about the future inched up but remained subdued.
In the Philadelphia survey, the new orders index rose to negative 5.2 from negative 17.9 Shipments moved to positive 10.7 from negative 6.2. Prices paid picked up while prices received slipped. The employee index fell deeper into negative territory.
Big picture: There is some hope of a recovery ahead in manufacturing. Both national surveys of manufacturing improved in January.
The national ISM factory index rose to just below breakeven at 49.1 in January, while the S&P Global manufacturing PMI rose to 50.7, the highest since September 2022.
Market reaction: Stocks
DJIA
SPX
were set to open higher on Thursday while the 10-year Treasury yield
BX:TMUBMUSD10
slipped to 4.223% in early morning trading. There was a flurry of economic indicators Thursday morning.
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