The monthly survey of Philadelphia-area manufacturers indicates that sector weakened in January, according to the Federal Reserve Bank of Philadelphia.
The report says that its indexes of new orders and "general activity" fell sharply. That's the indexes show that. This survey, called the Business Outlook Survey and released the third Thursday of the month, is presented as a diffusion index.
The footnotes to the Philly Fed's survey say this:
"Diffusion indexes represent the percentage of respondents indicating an increase minus the percentage indicating a decrease."
While it sounds more esoteric than saying that new orders fell by 2 percent last month, for example, there's no ignoring how gloomy this Fed survey is. The current general activity index touched a level not seen since 2001.
It noted that price pressures were elevated. More manufacturers recorded increases in their "input" prices and passed on price increases for their own goods.
The outlook for manufacturing growth over the next six months was also less optimistic than in December.
