Richmond Fed Manufacturing Activity Report Slumps

Fifth District manufacturing activity slumped back into contraction in September, according to the latest survey from the Richmond Fed, whose composite index fell 10 points to minus 9. Coming in much weaker than consensus and the range of analysts' forecasts, the decline was led by the resumption of weakness in shipments (down 19 to minus 14) and new orders (down 16 to minus 14 minus), the same components that drove a strong recovery in the previous month. Other components registering sharp declines included local business conditions (down 12 to minus 15) and capacity utilization (down 8 to minus 11). Employment was the exceptional bright note of the report, bouncing back from previous contraction (up 9 to 3).