Bloomberg (08/15/12) Caroline Fairchild
Manufacturing in the New York area unexpectedly contracted in August for the first time since October, indicating U.S. factories are burdened by the global economic slowdown. The Federal Reserve Bank of New York’s Empire State Index declined to minus 5.9 this month from 7.4 in July. The median estimate in a survey of Bloomberg economists was 7.0. Readings less than zero signal contraction in the index.
A slowdown in demand from consumers in the first half of the year, limited capital spending, and a build-up in inventories gives factories little reason to boost production. Orders for the region’s manufacturers fell to the lowest level in almost a year, showing the industry that spurred the recovery from recession is facing a bigger hurdle from a weaker global economy.