After stalling last month, factory activity in New York state picked up in July, but the near-term outlook for business conditions worsened sharply.
In particular, according to the related survey of the Federal Reserve of New York released today, “Empire State Manufacturing Survey”, the index of general business conditions increased to 11.1 in July from -1.2 in June.
It is worth noting that analysts in a Wall Street Journal survey expected a further deterioration of the index to -2.
The measure, based on a survey of manufacturing firms in the New York area, suggests that factory activity increased modestly (a reading below zero means contraction).
About 34% of companies surveyed said conditions improved in July compared to the previous month, while 23% said conditions worsened.
However, respondents were pessimistic about the short-term outlook for business, saying they expect activity to decline over the next six months. A sentiment that has prevailed only three other times in the survey’s history, as reported by the NY Fed.