The numbers: The New York Fed’s Empire State business conditions index, a gauge of manufacturing activity in the state, rose 10.4 points but remained at a negative 1.2 reading in June, the regional Fed bank said Wednesday. Economists had expected a flat reading, according to a survey by The Wall Street Journal.
Any reading below zero indicates deteriorating conditions.
In May, the index had slumped to negative 11.6, a reading 26 points below the consensus forecast.
Key details: The specifics of the report were somewhat stronger than the headline index.
For instance, the new-orders index rose 14.1 points to 5.3 in June, and the shipments index jumped 19.4 points to 4.
The prices-paid and prices-received indexes remained elevated.
Unfilled orders fell 6.9 points to negative 4.3 in June while delivery times lengthened at a slower pace, falling 5.7 points to 14.5.
Inventories rose 9.2 points to 17.1 in June.
Labor market indicators pointed to a solid increase in employment and a longer average workweek.
Optimism about the next six months declined 4 points to a “muted” 14.
Big picture: After declining last month, factory activity held steady. The Empire State index has been volatile in recent months but has weakened, analysts said. Some economists point the finger at slower economic growth in China. Another said that while CEOs are gloomy, the activity indexes remain buoyant.
The Empire State index is the first of several regional manufacturing gauges to be released.
In May, the closely-watched national ISM factory index rose to 56.1% from 55.4% in the prior month. The June ISM data will be released on July 1.
Market reaction: U.S. stocks DJIA, -0.50% SPX, -0.38% were set to open higher on Wednesday ahead of the Fed’s decision on interest-rate policy.