| Consensus | Consensus Range | Actual | Previous | |
|---|---|---|---|---|
| Index | -7 | -10 to -6 | -7 | -9 |
Highlights
The Richmond Fed manufacturing composite index showed a similar contraction in business activity at minus 7 in August compared with minus 9 in July, minus 8 in June, and minus 10 in May. Expectations centered on a minus 7 reading for August.
Richmond Fed described the region's current performance as"sluggish" with a decline in employment dragging down current indicators. Six-month expectations improved, however.
New orders, the forward-looking indicator, came in at minus 11 in August versus minus 20 in July, minus 16 in June and minus 24 in May. Shipments were at minus 5 in August versus minus 6 in July, minus 5 in June and minus 6 in May. Employment fell back into negative territory at minus 3 from 5 in July, minus 1 in June and 5 in May. Wages rose to 22 from 19 in July, 17 in June and 19 in May.
Prices paid were at 3.17 in August versus 4.07 in July, 4.56 in June and 4.81 in May. Prices received registered 3.11 in August versus 4.01 in July, 4.56 in June and 4.91 in May.
On the positive side, the index measuring six-month expectations for new orders improved to 22 in August from 9 in July, and expectations for shipments rose to 22 in August from 14 in July. The six-month expectations index for employment rose to 13 in August from 9 in July.
Richmond Fed described the region's current performance as"sluggish" with a decline in employment dragging down current indicators. Six-month expectations improved, however.
New orders, the forward-looking indicator, came in at minus 11 in August versus minus 20 in July, minus 16 in June and minus 24 in May. Shipments were at minus 5 in August versus minus 6 in July, minus 5 in June and minus 6 in May. Employment fell back into negative territory at minus 3 from 5 in July, minus 1 in June and 5 in May. Wages rose to 22 from 19 in July, 17 in June and 19 in May.
Prices paid were at 3.17 in August versus 4.07 in July, 4.56 in June and 4.81 in May. Prices received registered 3.11 in August versus 4.01 in July, 4.56 in June and 4.91 in May.
On the positive side, the index measuring six-month expectations for new orders improved to 22 in August from 9 in July, and expectations for shipments rose to 22 in August from 14 in July. The six-month expectations index for employment rose to 13 in August from 9 in July.
Market Consensus Before Announcement
Richmond Fed's manufacturing index in August is not expected to emerge from seven prior months of contraction, at a consensus minus 6 versus minus 9 in July.
Definition
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.
Description
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.
