There has been a significant slowing of growth measured in the June Empire State Manufacturing Survey which now shows that manufacturing hardly expanded in the month. With so many weak economic releases of late this may not be a huge surprise, but the severity may raise more eyebrows.

Today’s report showed that the general business conditions index fell by a whole 15 points down to only 2.3.  Bloomberg had a consensus reading of 13.8 and the range of the economist estimates was 5.0 to 16.1.  This was the worst reading of 2012 and this is just far short of expectations by all counts.

The new orders index, which is the growth portion of the number, fell by six points to 2.2; and the shipments index (the concurrent portion of the reading) fell by a whopping 19 points down to 4.8.

Inflation hawks will have remain silent here.  The Price indexes, which of course measures the inflationary component, saw a significant drop as the prices paid index fell by eighteen points down to 19.6 and the prices received index fell by eleven points to 1.0.

To show just how low this reading is, the prior month’s Empire State manufacturing index rose by 10.5 points to almost 17.1.

Some may argue that the data is at least still positive and not in contraction, but this drop is so severe that it might as well have been in the red.

JON C. OGG

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