This morning's release of the Empire Manufacturing report for September came in weaker than expected, declining slightly from last month's level of 8.24. While economists were expecting the headline General Business Index to come in at a level of 9.10, the actual level was 6.29. The chart below shows the Empire Manufacturing Index's General Business Index along with the expectation for conditions six months from now. As shown, even as current conditions declined, the expectations index increased. While it is natural for people to be more optimistic about the future, the current spread between the two indices is at its widest level since last September.
The table below breaks down the headline reading for today's report as well as the levels for each of the index's components. For each component, we also show what respondents are expecting six months from now. With respect to current conditions, seven out of nine sub-components were positive this month as Unfilled Orders and Delivery Time were the only ones in negative territory.
Looking out six months from now, manufacturers are not as positive. While expectations for New Orders and Shipments are both considerably more optimistic than current conditions, four of the nine sub-components are in negative territory.