Tuesday, October 27, 2020

Richmond Fed: "Fifth District manufacturing activity strengthened in October"

by Calculated Risk on 10/27/2020 01:52:00 PM

Earlier from the Richmond Fed: Fifth District manufacturing activity strengthened in October

Fifth District manufacturing activity strengthened in October, according to the most recent survey from the Richmond Fed. The composite index rose from 21 in September to 29 in October, its highest reading on record, buoyed by increases in the shipments and new orders indexes, while the third component—the employment index—was unchanged. Firms reported improving business conditions and growing backlogs of orders, overall. Manufacturers were optimistic that conditions would continue to improve in the coming months.

Survey results indicated that many manufacturers continued to increase employment and wages in October.
emphasis added
This was the last of the regional Fed surveys for October.

Here is a graph comparing the regional Fed surveys and the ISM manufacturing index:

Fed Manufacturing Surveys and ISM PMI Click on graph for larger image.

The New York and Philly Fed surveys are averaged together (yellow, through October), and five Fed surveys are averaged (blue, through October) including New York, Philly, Richmond, Dallas and Kansas City. The Institute for Supply Management (ISM) PMI (red) is through September (right axis).

The ISM manufacturing index for October will be released on Monday, November 2nd. Based on these regional surveys, the ISM manufacturing index will likely increase in October from the September level.

Note that these are diffusion indexes, so readings above 0 (or 50 for the ISM) means activity is increasing (it does not mean that activity is back to pre-crisis levels).