US regional manufacturing conditions continue to deteriorate

NY Fed's Empire State manufacturing index data released yesterday showed slight improvement to -16.6 in February (previous: -19.4), but fell below consensus for a reading of -10.5. New orders contracted for the ninth consecutive month, while shipments were little-changed from last month's reading.

The employment index fared better in February at -1.0 (previous: -13.0); however, the average workweek was soft at -5.9 (previous: -6.0). The ISM-adjusted version of the Empire State index, which averages the five components similar to those in the ISM manufacturing index, rose to 47.4 in February (previous: 43.0).

Data showed that demand for Northeast manufacturing production is continuing to deteriorate in Q1 and suggests further downside for US manufacturing in Q1.