Philly Fed Index Soars To Nearly Five-Year High In July

(RTTNews) - A report released by the Federal Reserve Bank of Philadelphia on Thursday showed its reading on regional manufacturing activity soared by much more than expected in the month of July.

The Philly Fed said its diffusion index for current general activity skyrocketed to 41.4 in July from 10.3 in June, with a positive reading indicating growth. Economists had expected the index to rise to 13.0.

With the much bigger than expected increase, the index surged to its highest level since hitting 44.0 in November 2021.

The new orders index also shot up to a nearly five-year high of 37.0 in July from 27.3 in June, while the shipments index spiked to 33.7 in July from 14.9 in June.

The report said the employment index also edged up to 10.0 in July from 7.9 in June, reaching its highest level since last December.

On the inflation front, the prices paid index crept up to 53.9 in July from 53.2 in June, while the prices received index climbed to 27.4 in July from 20.3 in June.

The Philly Fed also said firms continue to expect overall growth over the next six months, although the diffusion index for future general activity tumbled to 34.4 in July from 50.2 in June.

A separate report released by the Federal Reserve Bank of New York on Wednesday showed regional manufacturing activity has picked up considerably in the month of July.

The New York Fed said its general business conditions index jumped to 15.6 in July from 5.7 in June, with a positive reading indicating growth. Economists had expected the index to climb to 8.6.

Looking ahead, the New York Fed firms remained fairly optimistic conditions would improve in the months ahead, although the index for future business conditions dipped to 27.9 in July from 30.1 in June.