New York's manufacturing sector faced a significant decline in December as orders and shipments experienced a substantial downturn, the Federal Reserve Bank of New York reported on Monday. The Empire State Manufacturing Survey highlighted that the general business conditions index plummeted to 0.2 this month, a stark drop from 31.2 in November.
The anticipated monthly decrease was projected at 10, based on a survey conducted by Bloomberg. Richard Deitz, Economic Research Adviser at the New York Fed, commented, "Following a robust November, manufacturing activity in New York State stabilized in December. However, the pace of price increases has subdued, and there was a slight decline in employment." New orders saw a significant drop of 21.9 points, settling at 6.1, as reported by the Fed branch.
Shipments decreased from 32.5 in November to 9.4 this month. Moreover, the employment component slipped into contraction territory at minus 5.8 in December, contrasting with the growth of 0.9 noted the previous month, according to the survey results. The raw material cost index reduced to 21.1 from 27.8, while the selling prices metric also decreased to 4.2 from 12.4.
In assessing future conditions, the six-month outlook for general business conditions deteriorated by 8.6 points, landing at 24.6 this month. The future new orders index declined by 9.6 points to 21.8, although the shipments gauge displayed a slight improvement, rising by 1.5 points to 29.4. The forecast for employment growth also dipped to 13.8 from 23.9, indicating challenges ahead for the manufacturing sector in the forthcoming months..