NY Fed: Manufacturing growth slowest since November 2011
NEW YORK |
NEW YORK (Reuters) - A gauge of manufacturing in New York state fell sharply in June to its lowest level since November 2011 but still showed growth, the New York Federal Reserve said in a report on Friday.
The New York Fed's "Empire State" general business conditions index fell to 2.3, a 15-point drop from the month before and the lowest level since November 2011, and far below economists' expectations of 13.
Employment gauges also dropped, and indexes for the six-month outlook fell for the fifth consecutive month to 23.1, suggesting waning optimism about the medium-term. The shipments index dropped 19 points to 4.8, and the prices paid and new orders indexes also fell to their lowest levels since November 2011.
While the monthly survey is generally volatile, its poor showing this month is consistent with other signs pointing to a slowdown in the recovery of the U.S. economy overall amidst ongoing trouble in Europe and cooling growth in overseas markets like China.
"That is another indication that the U.S. economy is slowing. We are getting consistent evidence of slowing, that on top of what we are getting from Europe. It's an ugly situation. We might get coordinated central bank action," said Justin Hoogendoorn, fixed income strategist at BMO Capital Markets in Chicago.
"We can't extrapolate the state of the entire country's manufacturing base from this one region, but New York was one of the standouts in May that is now showing its vulnerability. I'm sure we'll see more weakness in other regions as the global economy continues to slow," said Peter Boockvar, equity strategist at Miller Tabak + Co.
U.S. stock index futures pared gains slightly, U.S. Treasuries added slight gains, and the dollar extended its losses versus the yen off of the weaker-than-expected numbers.
The survey of manufacturing plants in the state is one of the earliest monthly guideposts to U.S. factory conditions.
(Reporting by Anna Louie Sussman; Additional reporting by Richard Leong and Angela Moon; Editing by Chizu Nomiyama, Dave Zimmerman)
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