5th District Manufacturing Halts Decline Streak

The Federal Reserve's Fifth District manufacturing index rose by 10 points from the previous month to 0 in March of 2026, ahead of market expectations of a -5. The result reflected an unchanged level of manufacturing activity in the district, the first period without a contraction since February of the previous year despite pressure from the surge in energy prices since the outbreak of war in the Middle East during the month. Shipments contracted less (-2 vs -13 in February) amid a rebound in the volume of new orders (4 vs -9). Likewise, the pace of staff reduction fell sharply (-2 vs -7), although wage growth eased (14 vs 18) despite remaining sharp. In the meantime, prices paid decelerated (6.11 vs 6.52) despite the surge in wholesale energy commodities. Looking ahead, shipments (26 vs 29) and new orders growth (30 vs 35) eased but remained strong.

The Federal Reserve's Fifth District manufacturing index fell to -10 in February of 2025 from -6 in the previous month, the lowest in three months and missing expectations that it would improve to -4. The result reflected 12 months of negative readings, aligned with pessimistic signals from other regions of the US as tariffs magnified higher producer inflation to dent sentiment among goods producers. Shipments fall further (.13 vs .5 in January) as new orders dropped (-9 vs -6), even though companies continued to run through their order backlogs (-15 vs -13). In turn, prices paid remained elevated but at a softer pace than in the previous month (6.25 vs 7.06).

The Federal Reserve's Fifth District manufacturing index inched higher by one point from the previous month to -6 in January of 2026, the highest in four months, and ahead of the market consensus of a slight decrease to -8. Still, the result reflected an 11th consecutive month of pessimism on the district's goods producing sector. The drop in shipments softened (-5 vs -11 in December 2025) with support from a slower drop in new orders (-6 vs -8) and a faster depletion of backlog of orders (-13 vs -7). In the meantime, employment levels were seen lower (-6 vs -7) and wage growth fell (14 vs 24). Meanwhile, prices paid for inputs rose faster (7.06 vs 6.53), although competition prevented firms from passing those on to clients as output charges slowed (4.58 vs 4.98). Meanwhile, the expectations index for both shipments (34 vs 28) and new order volumes (36 vs 27) improved.