The July Manufacturing Business Outlook Survey from the Philadelphia Fed presented a mixed bag of indicators. The diffusion index for current general activity marginally improved from -13.7 to -13.5, slightly exceeding expectations of -15.5. But it registered its 11th consecutive negative reading. Also, the persistent negativity was reflected as over 30% of the firms reported decreases, outnumbering the 17% that reported increases. Nearly half of the firms (49%) reported no change in current activity.
The new orders index took a hit, dropping -5 points to -15.9, marking its 14th consecutive negative reading. The employment index also dipped marginally from -0.4 last month to -1.0 this month. Furthermore, the prices paid diffusion index decline by -1 point to 9.5.
In a ray of hope, the diffusion index for future general activity saw a significant jump from 12.7 in June to 29.1, recording the index’s highest reading since August 2021. This indicates growing optimism about future business conditions. Nearly 40% of firms anticipate an increase in activity over the next six months, up from 33% last month, with only 11% expecting a decrease (down from 20%). Meanwhile, 46% anticipate no change, slightly up from 44% in the previous month.
