August Philly Fed index points to stronger activity

Activity in the US mid-Atlantic factory sector gained momentum, according to the results of one of the most widely-watched surveys.

The headline Federal Reserve bank of Philadelphia's manufacturing sector index slipped from a reading of 19.6 in July to 18.9 for August.

That was just a shade below economists' forecasts for a print of 19.0.

However, the key 'new orders' sub-index raced ahead from a reading of 2.1 to 18.7, alongside improvement in gauges for shipments or for the length of the average workweek.

The latter rose from 3.8 to 8.6.

Yet cost pressures subsided during the month, with the 'prices paid' subindex retreating from 19.1 to 2.6.

Meanwhile, the inventories subindex advanced from 0.7 to 23.7.

"Although the index is well below the high of 43.3 recorded in February, it remains well within the expansionary territory and is consistent with manufacturing activity in the region.

"[...] In all, the details of today’s report suggest that manufacturing activity remains on a solid footing in the region."