New York Fed Index Falls More Than Expected

New York, NY, June 16, 2008--The New York Fed's "Empire State" general business conditions index fell to minus 8.68 from minus 3.23 in May.

The index contracted in June for the fourth time in five months, the New York Federal Reserve said while painting a mixed picture on inflation.

Economists had expected a reading of minus 2.00.

The prices-paid measure of inflation eased to 66.28 -- its first drop since December 2007 -- from 69.57 in May.

However, the gauge of prices-received jumped to 26.74 -- the highest since January 2006 -- from 15.22 in May.

The rise in prices received prompt the Federal Reserve to consider raising interest rates since it suggests manufacturers are able to pass their higher costs down the chain of buyers.