The Federal Reserve Bank of Richmond has issued its Fifth District Survey of Manufacturing Activity. While the report signals that growth was mild in January, it did indicate that new orders increased modestly and that average wages rose moderately.

All kidding aside, should the markets ask the Federal Reserve to more clearly define mild, modest and moderate?

The general index was 2 for January of 2016, down from 6 in December but up from -3 in November. Shipments were -6 in January, worse than the 0 reading in December and the -2 reading in November. New orders were 4 in January, versus 8 in December and -6 in November. The backlog of orders component was 4 in January, versus 0 in December and -16 in November.

Tuesday’s report showed that the volume of new orders grew modestly in January but signaled that shipments decreased. Hiring increased in January at a slightly slower pace, compared to December, but the average wages continued to increase at a moderate pace and the average workweek was also shown to have lengthened.

Those hoping for inflation may have found some good news, but the drop in energy prices and commodities around the globe may have thwarted whatever gains were seen. The report said that raw materials prices rose at a somewhat slower pace in January, but prices of finished goods rose at a faster pace than in December.

Manufacturers were more optimistic about future business conditions in January versus December, expecting faster growth in shipments and in new orders. Producers in the Fifth District also are looking for increased capacity utilization and anticipated rising backlogs, but with longer vendor lead times expected. Tuesday’s report said:

Survey participants planned more hiring, along with robust growth in wages and a pickup in the average workweek during the next six months. Firms looked for faster growth in prices paid and prices received over the next six months, although their outlook was below December’s expectations.

In the expectations components, all but capital expenditures were higher in January than December, and that was down only a point to 22 and was much higher than the reading of 6 in November. Expectations upticks were seen as follows (January versus December):

• Shipments were 34 vs. 24.
• Volume of new orders, 28 vs. 23.
• Backlog of orders, 13 vs. 11.
• Capacity utilization, 29 vs. 16.
• Vendor lead-time, 10 vs. 8.
• Number of employees, 23 vs. 16.
• Average workweek, 14 vs. 4
• Wages, 33 vs. 22.

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