Philly Fed Manufacturing Index Extraordinarily Weak - Economy Weakening

Discussion in 'Economics' started by ByLoSellHi, Feb 15, 2007.


    NEW YORK, Feb 15 (Reuters) - Factory activity in the U.S. Mid-Atlantic region barely grew in February, giving back most of January's rebound from a dip at the end of last year, according to a survey released on Thursday.

    The Philadelphia Federal Reserve Bank said its business activity index slumped unexpectedly to 0.6 in February from 8.3 in January.

    Wall Street analysts on average had forecast a dip to 5.0, but the result was under even the lowest of projections.

    In January, the index rose to its highest since August 2006. A reading above zero indicates growth in the region's manufacturing sector.

    The new orders index, a gauge of future growth, fell to minus 0.5 in February after 1.3 in January.

    The survey, covering eastern Pennsylvania, southern New Jersey and Delaware, is seen as an early indicator of the health of the U.S. manufacturing sector.

    It follows reports showing an unexpected fall in January U.S. industrial output but surprisingly strong New York State factory activity in February.
  2. WASHINGTON (Reuters) - Federal Reserve Chairman Ben Bernanke on Thursday told lawmakers that the economy may be growing faster than expected.
  3. they are going to manipulate this economy ayway they can
  4. Jan. industrial output plunges

    U.S. housing-related industry weakness, auto cutbacks lead to biggest drop in last 17 months.

    Martin Crutsinger / Associated Press

    Industrial output fell in January by the largest amount in 17 months, reflecting huge cutbacks at auto factories and weakness in housing-related industries.

    The Federal Reserve reported Thursday that output at the nation's factories, mines and utilities was down 0.5 percent in January, the biggest setback since Hurricane Katrina disrupted activity in the fall of 2005.

    Half of last month's decline reflected a drop of 6 percent in output at auto and auto parts factories with smaller setbacks in housing-related industries such as furniture, appliances and carpeting.

    Overall, manufacturing fell by 0.7 percent, with analysts predicting continued weakness in coming months reflecting the problems in autos and the slumping housing industry.

    "Automakers are working off a lot of unsold vehicles and they can't offer discounts as they have in years past because of their poor financial conditions," said Mark Zandi, chief economist at Moody's

    Big benefit request jump

    In other news, the number of newly laid off workers filing claims for unemployment benefits jumped by 44,000 to 357,000 last week. It was the largest one-week increase since September 2005 after Hurricane Katrina.

    The Labor Department reported that the four-week moving average for claims rose to 326,250 last week, the highest level in nine weeks and an indication that conditions in the job market have softened.

    Part of the increase in jobless claims last week was due to a blast of cold in the Midwest and Northeast, which triggered higher layoffs in such industries as construction.

    The 0.5 percent drop in industrial production was much worse than the unchanged performance that had been expected. But economists said part of the decline reflected a payback for December, when unusually warm weather boosted output. Industrial output had risen 0.5 percent in December.