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Manufacturing Firms Report Continued Expansion

Federal Reserve Bank of Philadelphia (07/17/14)

Firms responding to the Federal Reserve Bank of Philadelphia’s Business Outlook Survey indicated continued expansion in the region’s manufacturing sector in July. The diffusion index of current general activity increased from a reading of 17.8 in June to 23.9 in July. The index has remained positive for five consecutive months and is at its highest reading since March 2011. The current new orders and shipments indexes grew substantially this month, increasing 17 points and 19 points, respectively. Both unfilled order and delivery time indexes were positive for the second consecutive month, suggesting continued strengthening conditions.

The current indicators for labor market conditions also suggest improved conditions this month. The employment index remained positive, and, although it increased less than one point, it has improved for four consecutive months. The percentage of firms reporting increases in employment (24%) exceeded the percentage reporting decreases (12%). The work week index was positive for the fifth consecutive month and increased five points.