New York Fed Factory Index Plunged by Most Ever This Month

(Bloomberg) — A gauge of manufacturing in New York State plunged in March by the most on record, offering one of the first signs of the drastic toll the coronavirus will exact on domestic producers and the economy.

The Federal Reserve Bank of New York’s general business conditions index fell 34.4 points to minus 21.5, the lowest level since 2009, a report out Monday showed. The bank’s gauges of new orders, shipments and employment all fell into negative territory.

The figures suggest the coronavirus, which has disrupted global supply chains and is poised to significantly weigh on the nation’s growth, has already started to hit manufacturers. As more extreme measures are made to contain the virus, future readings may deteriorate further.

Manufacturers in New York expect a gloomier future too. The index of future business conditions also dropped to an 11-year low. A gauge of shipments fell to the weakest level since September 2016, and the index of the average employee workweek slumped to its lowest level since December 2015.

The survey responses were collected between March 2 and March 10.

Readings above zero indicate expansion, and the median forecast in a Bloomberg survey of economists had called for the gauge to decline to 3. The Empire State survey is the first of several regional Fed manufacturing indexes to be released for the month. Others for areas including Philadelphia, Richmond and Dallas will be released throughout the month.

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