Philadelphia Fed Manufacturing Activity Slows but Beats Expectations

The Philadelphia Fed Manufacturing Index fell to 37.8 in September 2026 from 47.4 in August, but remained well above market expectations of 30.5, pointing to continued expansion in regional manufacturing, albeit at a slower pace. New orders and shipments remained elevated, while the employment index declined but stayed positive, signalling continued job growth. Both price indicators also moved higher after falling in August. Looking ahead, firms remained optimistic about the next six months, with 57.9% expecting an increase in general business activity and just 5.0% anticipating a decline.

The Philadelphia Fed Manufacturing Index rose to 47.4 in August 2026 from 41.4 in July, its highest level since April 2021 and well above expectations of 25. Nearly 57% of surveyed companies reported higher activity, while only 10% recorded declines. However, new orders eased to 30.1 and shipments fell to 27.7, although both remained at relatively strong levels. The employment index jumped to 27.9, its highest reading since April 2022, pointing to continued job creation in manufacturing. Price pressures also moderated, as the prices-paid index declined to 40.9 and the prices-received measure fell to 17.7, although both remained elevated. Looking ahead, manufacturers became considerably more optimistic. The future general activity index surged 39 points to 73.6, its strongest reading since August 1983.

The Philadelphia Fed Manufacturing Index climbed to 41.4 in July 2026 from 10.3 in June, largely beating market expectations of 13. The latest data pointed to a continued recovery in business conditions, with activity expanding at the fastest pace since November 2021. The current new orders index jumped 10 points to 37.0, its highest level since November 2021, while the shipments index climbed 19 points to 33.7, the strongest reading since April. The employment index edged up 2 points to 10.0, its highest level since December, and the average workweek index surged 21 points to 14.0, reaching its highest reading since January 2025. Meanwhile, both price indicators continued to signal rising prices, with the prices paid index edging up to 53.9 and the prices received index jumping 7 points to 27.4. Firms maintained positive expectations for the next six months, even as most future indicators eased from elevated levels.