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Philly Fed Index Pulls Back But Still Indicates Growth In April

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A report released by the Federal Reserve Bank of Philadelphia on Thursday showed the pace of growth in regional manufacturing activity slowed by more than anticipated in the month of April following a significant rebound in the previous month.

The Philly Fed said its index for current manufacturing activity in the region dropped to 8.5 in April after jumping to 13.7 in March.

While a positive reading still indicates growth in regional manufacturing activity, economists had expected the index to show a more modest pullback to 10.4.

The pullback by the headline index came as the survey's other broad indicators turned in a mixed performance, as the shipments index dipped to 18.4 from 20.0 but the new orders index jumped to 15.7 from 1.9.

The report also said the number of employees index climbed to 14.7 in April from 9.6 in March, indicating a faster rate of job growth.

With regard to inflation, the prices paid index rose to 21.6 in April from 19.7 in March, while the prices received index dropped to 20.0 from 24.7.

The Philly Fed said the diffusion index for future general activity slid to a three-year low of 19.1 in April from 21.8 in March, as most firms are less optimistic about future activity and employment.

On Monday, the New York Federal Reserve released a separate report showing growth in regional manufacturing activity picked up somewhat in April but remained fairly subdued.

The New York Fed said its headline general business conditions index climbed to 10.1 in April after falling to 3.7 in March. Economists had expected the index to rise to 6.0.

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