New York state manufacturing activity tumbles in March

“Input price increases climbed for a third straight month to hit their fastest pace in more than two years,” commented New York Fed economic research advisor Richard Deitz. The full release is available here.

The General Business Conditions Index contracted by 26 points in March to a one-year low of -20.0. This is a diffusion index, where a positive reading signifies expansion from the prior month, zero indicates no change, and a negative reading signifies contraction.

The Empire State Manufacturing Index has only signaled improving business conditions in 10 of the past 30 months. One year ago the Index stood at -20.9.

Trends

To smooth monthly fluctuations, the Index can be recalculated on a three-month moving average basis (3MMA) to better highlight trends. On this basis, the Index slipped seven points from February to March to an eight-month low of -9.0 (Figure 1). Last year we saw dramatic swings in the 3MMA; it tumbled to a near four-year low of -22.3 in March, then climbed to a near three-year high of 10.3 by November.

An interactive history of the Empire State Manufacturing Index is available here on our website.