New York Manufacturing Activity Unexpectedly Expands In June

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After reporting an unexpected contraction in regional manufacturing activity in the previous month, the Federal Reserve Bank of New York released a report on Wednesday showing that business activity for New York manufacturers expanded modestly in June.

The New York Fed said its general business conditions index jumped to a positive 6.0 in June from a negative 9.0 in May, with a positive reading indicating an expansion in regional manufacturing activity.

Economists had expected the index to show a much more modest rebound to a negative 3.5, which would have still indicated a contraction.

The turnaround by the headline index reflected strong rebounds in both new orders and shipments, which increased after last month's declines.

The new orders index surged up to a positive 10.9 in June from a negative 5.5 in May, while the shipments index climbed to a positive 9.3 from a negative 1.9.

Meanwhile, the New York Fed said the number of employees index dipped to zero in June from 2.1 in the previous month, indicating that employment levels remained flat

The report also said the prices paid index edged up to 18.4 in June from 16.7 in May, while the prices received index improved to a negative 1.0 from a negative 3.1.

Looking ahead, the New York Fed said the indexes for the six-month outlook suggested that respondents were more sanguine about future conditions.

The index for future business conditions climbed to 34.8 in June from 28.5 in May, reaching its highest level of 2016.

Thursday morning, the Philadelphia Federal Reserve is scheduled to release its report on regional manufacturing activity in June.

The Philly Fed Index is expected to rise to a positive 0.8 percent in June after edging down to a negative 1.8 in May.

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