Global| Nov 22 2015Philadelphia Fed Nonmanufacturing Business Index Slips Slightly in November, but Details Brighter
by:Sandy Batten
|in:Economy in Brief
Summary
The Federal Reserve Bank of Philadelphia's Nonmanufacturing Business Index of current conditions slipped a bit in November to 15.6 from 16.3 in October. This was the fourth consecutive monthly decline and the lowest level since July [...]
The Federal Reserve Bank of Philadelphia's Nonmanufacturing Business Index of current conditions slipped a bit in November to 15.6 from 16.3 in October. This was the fourth consecutive monthly decline and the lowest level since July 2015. Still, 41% of respondents reported an increase in current activity, up from 40% in October. There is not a market consensus forecast for this release. The expectations index for November was unchanged at 40.4, though 54% of respondents look for stronger activity six months from now. This index has generally fluctuated within a range during 2016.
The components of the release, however, demonstrated more optimism that did the headline current conditions index. The new orders index jumped to 12.6 in November from 5.7 in October with 34% reporting an increase. Sales/revenues exhibited even more ebullience, surging to 17.2 in November from 6.0 in October with 39% of respondents indicating an increase in sales/revenues in November. And the number of full-time permanent employees index rose to 14.3 from 8.5 in October with 27% reporting an increase. Prices paid edged up to 16.5 from 15.0 in October.
The Philadelphia Fed figures are diffusion indexes which are calculated by subtracting the percent of respondents reporting poorer business conditions from those reporting improvement. So, readings above zero indicate more positive than negative responses. These indexes have a good correlation with growth in the series covered. The data are available in Haver's SURVEYS database.
| Federal Reserve Bank of Philadelphia: Nonmanufacturing Business Outlook Survey (Diffusion Index, SA) | Nov | Oct | Sep | Nov'15 | 2015 | 2014 | 2013 |
|---|---|---|---|---|---|---|---|
| General Activity - Company | 15.6 | 16.3 | 16.7 | 28.3 | 31.4 | 38.8 | 29.8 |
| New Orders | 12.6 | 5.7 | 10.6 | 17.2 | 21.7 | 27.9 | 20.2 |
| Sales or Revenue | 17.2 | 6.0 | 11.1 | 24.0 | 23.6 | 30.2 | 27.0 |
| Inventories | 5.6 | 7.6 | -1.1 | 2.9 | 5.2 | 5.8 | 3.0 |
| Number of Full-Time Permanent Employees | 14.3 | 8.5 | 19.3 | 15.7 | 15.6 | 17.3 | 18.8 |
| Prices Paid | 16.5 | 15.0 | 29.9 | 19.1 | 19.3 | 19.7 | 20.6 |
| Expected General Activity - Company | 40.4 | 40.4 | 52.7 | 56.6 | 54.0 | 60.1 | 47.4 |
Sandy Batten
AuthorMore in Author Profile »Sandy Batten has more than 30 years of experience analyzing industrial economies and financial markets and a wide range of experience across the financial services sector, government, and academia. Before joining Haver Analytics, Sandy was a Vice President and Senior Economist at Citibank; Senior Credit Market Analyst at CDC Investment Management, Managing Director at Bear Stearns, and Executive Director at JPMorgan. In 2008, Sandy was named the most accurate US forecaster by the National Association for Business Economics. He is a member of the New York Forecasters Club, NABE, and the American Economic Association. Prior to his time in the financial services sector, Sandy was a Research Officer at the Federal Reserve Bank of St. Louis, Senior Staff Economist on the President’s Council of Economic Advisors, Deputy Assistant Secretary for Economic Policy at the US Treasury, and Economist at the International Monetary Fund. Sandy has taught economics at St. Louis University, Denison University, and Muskingun College. He has published numerous peer-reviewed articles in a wide range of academic publications. He has a B.A. in economics from the University of Richmond and a M.A. and Ph.D. in economics from The Ohio State University.
