Growth in Philadelphia-area manufacturing activity slowed by much more than anticipated in the month of August, according to a report released by the Federal Reserve Bank of Philadelphia on Thursday.
The Philly Fed said its index for current general activity tumbled to 11.9 in August from 25.7 in July. While a positive reading still indicates growth in regional manufacturing activity, economists had expected the index to show a much more modest drop to 22.0.
The bigger than expected decrease by the headline index was partly due to a significant slowdown in the pace of new orders growth, as the new orders index plunged to 9.9 in August from 31.4 in July.
The shipments index also slumped to 16.6 in August from 24.7 in July, while the number of employees index dipped to 14.3 from 16.8.
The report also said the prices paid index slid to 55.0 in August from 62.9 in July, and the prices received index fell to 33.2 from 36.3.
Looking ahead, the Philly Fed said expectations for the next six months remained optimistic, with most broad future indicators showing improvement. The diffusion index for future general activity jumped to 38.8 in August from 29.0 in July.
A separate report released by the New York Federal Reserve on Wednesday showed regional manufacturing activity remained robust in the month of August.
The New York Fed said its general business conditions index climbed to 25.6 in August from 22.6 in July, while economists had expected the index to dip to 20.0.