No good news when news has been bad is bad news...
We build up our knowledge of the economy one report at a time. The June MFG index from the NY Fed is another inch along the road to understanding MFG trends. Aside from the report's details for June, there is evidence from it's broader trends that there is a small a bounce in the recent three months compared to six months. But it's nothing to get excited over. June itself backtracked from May.
Inflation influenza is building
New weakness has cropped up in unfilled orders. Prices paid are soaring and now the prices received index- not available in all of the regional MFG surveys and not present at all in the national ISM - shows that price increases are being passed through and are expected to be passed through with even more vigor in the future. Employment conditions in NY MFG are sort of mid range.
The news in this report is that conditions are still poor. The outlook is middling even with the current reading at such a depressed level. That is a bad sign.
NY is not THE litmus test for MFG but is a litmus test
New York's signal does not assure us of how MFG is or will be but it's another step along the path to finding out; according to NY MFG businesses, conditions are not really improving in June.