US: Richmond Fed Manufacturing Index

Tue Jan 23 09:00:00 CST 2018

Consensus Consensus Range Previous
Level 18 17 to 21 20

Market Consensus Before Announcement
The Richmond Fed manufacturing index has, like other regional manufacturing reports, been running at unusually high levels which made December's 10-point cooling to a still elevated 20 welcome news. Growth in new orders slowed by nearly 20 points in December to 16 and backlogs fell into contraction at minus 4. But shipments at 24 and employment at 20 both remained unusually strong and hint at the risk of overheating. The Econoday consensus for January's index is 18.

This survey tracks business conditions in the Richmond Fed's manufacturing sector. The headline index is a composite of the new orders, shipments, and employment indexes.

Investors need to monitor the economy closely because it usually dictates how various types of investments will perform. By tracking economic data such as the regional Fed surveys, investors will know what the economic backdrop is for the various markets. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers more moderate growth so that it won't lead to inflation. These surveys give a detailed look at the manufacturing sector, how busy it is and where things are headed. Since manufacturing is a major sector of the economy, this report has a big influence on market behavior.