Empire State index dips unexpectedly in September

Factory sector activity in the jurisdiction of the Federal Reserve bank of New York was little changed in September.

The Federal Reserve bank of New York's manufacturing sector index dipped by 2.0 points from August's level to reach -2.8.

Economists had forecast a reading of 4.0.

The key sub-index for new orders declined by 3.2 points to 3.5 as another linked to firms' shipments dropped by 3.5 points to 5.8.

Prices charged on the other hand rose, with the corresponding sub-index climbing by 6.2 points to 29.4 and another tracking the number of employees at firms jumping by 11.3 points to 9.7.

Companies also continued to top up their stockpiles, with a sub-index for inventory levels rising by 2.7 points to 8.5.

Commenting on the latest survey readings, Ian Shepherdson at Pantheon Macroeconomics said the rise in the subindices for employment and inventories contradicted the dip in the headline index.

However, he believed the link between the NY Fed's index and the ISM institute's manufacturing sector index "was broken" so that there was scant chance that the latter might now be set for a strong rebound.

"Manufacturing has been in recession since Q1; we don’t see that changing anytime soon, though the sector is not in meltdown."