Manufacturing activity in the Mid-Atlantic region lost momentum this month, according to new data from the Federal Reserve Bank of Philadelphia. The bank’s latest survey revealed a sharp decline in its measure of current general activity, signaling a contraction in the regional factory sector.
The Philly Fed’s diffusion index for current activity fell to -12.8 in October, reversing sharply from +23.2 in September. Economists had been looking for a reading near +10.0, making the drop significantly steeper than anticipated.
This marks the lowest level for the index since April, when it bottomed at -26.4. A negative reading indicates shrinking activity, underscoring a clear pullback in manufacturing conditions.
Despite the weak current numbers, the outlook remains more upbeat. The survey’s future general activity index climbed to 36.2, its highest reading in five months, up from 31.5 in September. This suggests that manufacturers broadly expect conditions to improve over the next half year.
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