Manufacturing in the Philadelphia region expanded in April at a slower pace than projected as fewer orders prompted managers cut back on hiring and inventories.
The Federal Reserve Bank of Philadelphia’s general economic index fell to 1.3 in April from 2 the prior month. Readings greater than zero signal expansion in the area covering eastern Pennsylvania, southern New Jersey and Delaware. The median forecast of economists surveyed by Bloomberg called for a gain to 3.
The data follow a report last week showing expansion also cooled at factories in the New York Fed region. This week, separate data from the Federal Reserve indicated output at factories is moderating as companies try to limit inventories as the world’s largest economy slows after gaining speed in the first quarter.
Estimates of 55 economists in the Bloomberg survey ranged from minus 5 to 10.
The Philadelphia Fed’s new orders measure fell to minus 1 from 0.5 in March, while shipments climbed to 9.1 from 3.5. The inventory index dropped to minus 22.2, the weakest since October 2009, from zero.
A measure of employment decreased to minus 6.8 from 2.7.
The measure of prices paid eased to 3.1 in April, the weakest since July 2009, from 8.5 in March. An index of prices received decreased to minus 7.5, the lowest since August 2010, from minus 0.8.
Economists monitor the Fed’s regional surveys for clues about the Institute for Supply Management national figures on manufacturing. The next ISM report is due May 1. Manufacturing makes up about 12 percent of the economy.