Philly Fed Index Unexpectedly Indicates Faster Growth In September

A report released by the Federal Reserve Bank of Philadelphia on Thursday showed an unexpected improvement in regional manufacturing conditions in the month of September.

The Philly Fed said its index for current manufacturing activity rose to 23.8 in September from 18.9 in August, with a positive reading indicating growth. Economists had expected the index to drop to 17.2.

The unexpected increase by the Philly Fed Index partly reflected notable accelerations in the pace of growth in new orders and shipments.

The new orders index jumped to 29.5 in September from 20.4 in August, while the shipments index surged up to 37.8 from 29.4.

Meanwhile, the report said the number of employees index fell to 6.6 in September from 10.1 in August, indicating a slowdown in the pace of job growth.

The Philly Fed also said the prices paid index shot up to 34.4 in September from 21.1 in August, while the prices received index climbed to 22.8 from 13.5.

Looking ahead, the survey's future indicators suggest that manufacturers have generally grown more optimistic over the past three months.

The diffusion index for future general activity advanced to 55.2 in September from 42.3 in August, reaching its highest reading since March.

Last Friday, a separate report from the New York Fed showed activity in the New York manufacturing sector saw a modest slowdown in the pace of growth in September.

The New York Fed said its general business conditions index edged down to 24.4 in September from 25.2 in August. The index had been expected to drop to 19.0.