Philly Fed manufacturing index falls, survey confirms year-end manufacturing softness

The Philly Fed manufacturing index fell to -5.9 in the December reading, down from 1.9 last month and well below forecast (2.0) and consensus (1.0) expectations. Similar to the Empire State survey, new orders contracted (-9.5, previous: -3.7) while shipments rose above neutral on the month (3.7, previous: -2.5).

The labor market side of the Philly Fed survey was decidedly stronger, however, with the employment index (4.1, previous: 2.6) and average workweek (5.5, previous: -16.2) improving in December.

"Negative readings from delivery times (-6.1, previous: 0.5) and unfilled orders (-17.7, previous: 2.4) confirm our overall view that manufacturing activity has yet to find a bottom. The ISM-adjusted version of the index was unchanged at 48.1, marking the third consecutive month of an overall contraction in regional manufacturing activity", says Barclays.