Philly Fed manufacturing index turns negative in July

Manufacturing conditions in the Philadelphia region unexpectedly deteriorated in July, with activity contracting, according to the latest report from the Federal Reserve Bank of Philadelphia.

The diffusion index for current activity fell to -2.9 from 4.7 in June, missing expectations for an increase to 5.0. The index has been negative for nine of the past 11 months.

The new orders index rose to 11.8 from -3.0 in June while the current shipments index increased to 6.3 from -2.1.

Firms reported higher prices paid for materials and other inputs in July, but prices received for manufactured goods were relatively steady.

The survey’s index of future activity improved slightly, and firms expect growth in new orders and shipments over the next six months.