New York Manufacturing Activity Drops

Washngton, DC, March 15, 2007--Manufacturing activity in the New York area came to a virtual standstill in March, the New York Federal Reserve Bank said Thursday.

The bank's Empire State Manufacturing index fell sharply to 1.9 in March from 24.4 in February. The index fell to its lowest level since May 2005. Readings over zero indicate expansion.

Economists were expecting the index to slip to 19.0.

The new orders index also fell sharply and the shipments and unfilled orders indexes declined.

The prices paid index inched upwards.

Expectations of price increases over the next six months also increased, suggesting that factory owners expect price pressures to accelerate.

March's Empire State new orders index fell to 3.1 from 18.9. Shipments fell to 18.5 from 27.1 in February.

The employment index fell slightly to 11.4 in March from 12.7 in February.

Survey respondents expected business conditions to continue to improve over the next six months.

The future index for general business conditions fell to 35.2 in March from 38.5 in the previous month.