Philly Fed Outlook +50.2 in April, exceeds consensus

Current Indicators Remain Elevated

The index for current manufacturing activity rose from a revised reading of 44.5 in March to 50.2 this month, its highest point in nearly 50 years (see Chart 1).* Nearly 59 percent of the firms reported increases in current activity this month; only 8 percent reported decreases. The current new orders index edged down 2 points to 36.0 in April, while the current shipments index increased 3 points to 25.3. 

The firms continued to add to their payrolls this month. The current employment index increased from a revised reading of 27.4 in March to 30.8 this month, its highest recorded reading. Over 35 percent of the responding firms reported increases in employment, while only 4 percent of the firms reported decreases. The current workweek index fell 7 points to 29.8. 

Price Indexes Suggest Increasing Prices

The firms continued to report price pressures from purchased inputs. The prices paid index edged down 4 points to 69.1 in April after reaching a 40-year high in March (see Chart 2). Over 71 percent of the firms reported higher input prices this month, while only 2 percent of the firms reported lower input prices. The firms also reported overall increases in prices for their own manufactured goods: The prices received index increased 4 points to 34.5.

Firms Remain Optimistic About Growth

The diffusion index for future general activity rose 8 points to 66.6 this month, its highest reading since October 1991 (see Chart 1). Seventy-one percent of the firms expect increases in activity over the next six months, while 4 percent expect declines. The future new orders and shipments indexes also increased, rising 11 points and 10 points, respectively. The future employment index rose 9 points to 55.7. Over 56 percent of the firms expect to increase employment over the next six months; hardly any firms expect to decrease employment. The future capital spending index rose 3 points to 36.7.