By Utta Von Nuremburg

WASHINGTON (MNI) – The New York Federal Reserve’s Wednesday release
of its measure of regional manufacturing activity will provide the first
clue on the progress of the U.S. manufacturing sector in September, and
one economist expects a deeper drop than most due to the negative new
orders reading in last months’ report.

The general business conditions index in the Empire State
Manufacturing Survey is expected to fall to 5 in September, according to
a survey of economists by Market News International. Following a reading
of 7.10 in August, a fall in the index would suggest a slower rate of
expansion in manufacturing activity, if expectations are met.

David Sloan, economist at 4CAST Ltd, expects a bigger decline that
the consensus, predicting September’s number will drop to 2.5.

“Other economists that provided estimates are likely to have been
encouraged by the positive data reported in August’s ISM Manufacturing
report,” he told Market News International in a phone interview.
“However, we are unconvinced that a rise will occur due to the negative
new orders index reading in August’s Empire State Manufacturing Survey.”

Despite the general business conditions index inching up two points
in August’s Empire State Manufacturing Survey, the new orders and
shipment indexes both dipped below zero for the first time in more than
a year to -2.71 and -11.50 respectively.

Not only did the August report show that manufacturers’ new orders
declined slightly, but the unfilled orders index was also in negative
territory at -10.00, its fifth consecutive monthly decline and following
-15.87 in July.

However, according to August’s Manufacturing report by the
Institute of Supply Management, “manufacturing activity continued at a
very positive rate in August as the PMI rose slightly when compared to
July. In terms of month-over-month improvement, the Product and
Employment Indexes experienced the greatest gains, while new orders
continued to grow but a slightly slower rate.”

–Utta Von Nuremburg is a reporter with Need To Know News In Washington

** Market News International Washington Bureau: 202-371-2121 **

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