New York, U.S. Manufacturing Declines in May

New York, NY, May 15, 2008--New York manufacturing  contracted in May for the third time in four months, as a drop in orders caused businesses to pull back.

The Federal Reserve Bank of New York's general economic index fell to minus 3.2 from 0.6 percent in April.

Economists forecast the Empire State index would fall to 0 this month.

The New York Fed's measure of new orders decreased to minus 0.5 from 0.1 the prior month, and a measure of unfilled orders improved to minus 4.4 from minus 6.3.

A gauge of shipments dropped to 4.6 from 17.5. The index of inventories decreased to minus 6.5 from minus 4.2.

Increases in raw-material costs hurt factories. The index of prices paid jumped to a record 69.6 from 57.3, and the gauge of prices received decreased to 15.2 after 20.8.

However, companies were more optimistic about the future. Readings for six months from now increased to 23.9 from 19.6 in April.

In a related report, the Federal Reserve said U.S. industrial production fell faster than expected in April, led by reduced manufacturing of autos, business equipment and construction supplies.

The bank reported that industrial production in April fell 0.7 percent, a larger drop than the 0.3 percent decline that was expected by economists.