Philadelphia Factory Activity Unexpectedly Rises

The Philadelphia Fed Manufacturing Index climbed to 26.7 in April 2026 from 18.1 in the prior month, hitting its strongest level since January 2025. The data surprised analysts on the upside, comfortably exceeding expectations for a drop to 10. The current shipments index rose 12 points to 34.0, while the index for current new orders jumped 24 points to 33.0. Meanwhile, the employment index fell 6 points to -5.1 in April. Both price indexes increased for the second month, continuing to run well above their long-term averages and marking their highest levels since August. The prices paid index rose 15 points to 59.3 in April, while the current prices received index rose 12 points to 33.5. Looking forward, the firms continue to expect overall growth over the next six months, although most future indicators have moved down.

The Philadelphia Fed Manufacturing Index rose to 18.1 in March 2026, the highest since September 2025, from 16.3 in February and way better than analysts' forecasts of 10. This marked the third consecutive month in positive territory, indicating continued expansion in regional manufacturing. The index for current new orders fell 3 points to 8.6, while the current shipments index rose 22 points to 22.2, its highest reading since January 2025. The inventories index ticked up 2 points to 1.4. At the same time, the employment index returned to positive territory, up 2 points to 0.8, but continued to suggest mostly steady employment overall. Both price indexes rose this month after declining last month. The prices paid index rose 6 points to 44.7, while the prices received index rose 5 points to 21.2. Looking ahead, the firms continue to expect overall growth over the next six months.

The Philadelphia Fed Manufacturing Index rose to 16.3 in February 2026, the highest since September and above expectations of 8.5. General business activity and new orders remained moderately strong, but shipments slowed sharply and nearly stalled. Employment levels were mostly steady, yet the employment index turned slightly negative and the average workweek shortened. Prices continued to rise overall, although both input costs and selling prices increased at a slower pace than before. Customer price sensitivity stayed largely unchanged, though about a third of firms said customers are becoming more sensitive to price. Many firms still expect industry costs to change soon, and most anticipate competitors will raise prices within three months. Tariffs were reported to have had a mostly negative impact over the past year, and many firms expect continued negative effects. Expectations for growth over the next six months strengthened, though planned capital spending declined.