Washington, August 16--Manufacturing activity in the New York area slowed dramatically in August, the New York Federal Reserve Bank said Monday.
The bank's Empire State Manufacturing index plunged to 12.6 in August from 35.6 in July. This is the biggest monthly drop since Oct. 2002.
The index is at its lowest level since May 2003.
But the index is still above zero, which indicate expansion. Aside from a slight dip in March, the Empire State index has been above 30 since last October.
The drop stunned economists, who were expecting the index to slip only to about 31.8 in August.
The new orders index fell to 14.9 from 28.6 in July, while shipments fell to 11.9 from 34.0.
The unfilled orders index fell to -4.6 from 14.3 in the previous month. This is the first negative reading since last September.
Despite the decline in the overall index, the number of employees rose to 17.0 in August from 13.1 in July.
But the average employee workweek fell to 6.8 in August from 22.5 in the previous month.
The price indexes remained elevated.
The prices paid index fell slightly to 50.0 in August from 56.4 in July.
The prices received index fell to 16.3 in August from 18.0 in the previous month.
