The October NY manufacturing index rose almost 6 pts to 30.2 and that was about 10 pts above the estimate. The index level also matches the best level in 8 years. Notwithstanding the headline jump, the internals were more mixed. New orders fell 7 pts to a 3 month low at 18 after rising by 4.3 pts in September. Backlogs dropped by 6.6 pts to 2.3 and inventories fell below zero at -7.8 from +6.5. Shipments did jump by 11.3 pts but follows previous orders. Employment rose 5 pts but the average workweek fell by 5.7 pts. Prices paid and received both fell m/o/m. The overall 6 month business activity outlook rose 5.5 pts after dropping by 5.9 pts last month. Capital spending plans fell by 2.5 pts after more than doubling last month. Tech spending plans fell slightly but also after jumping in September.
Bottom line, the headline jump in this index masked a more mixed picture underneath (the headline number is not a sum of its parts) and US Treasuries didn’t respond at all to the number (it rarely does). This said, likely helped by the weaker dollar and rebound in overseas economies, manufacturing confidence has clearly improved. We see the Philly regional survey on Thursday.
NY MANUFACTURING INDEX