The Empire Fed fell to -43.7 in January from -14.5 previously.
It's the earliest manufacturing data point of the month and at first glace it suggests a sharp contraction in activity. New orders plunged to -49.4 from -11.3.
The dollar fell around 20 pips across the board but there are indications this survey is an outlier, in part because there have been no signs of a sudden stop in manufacturing, especially something akin to the pandemic drop.
What's particularly curious is that he six-month forward indexes all improved markedly with the overall index up to 18.8 from 12.2 and new orders to 25.2 from 11.3. Employment, shipments and cap ex also improved. The release itself offered little insight about what's happening.
Empire is the first manufacturing index released of the month so this will heighten the focus on the upcoming releases but for now, the market is looking at the report with a skeptical eye.