Forex and Global news l TheLFB News l Apr 15 09 l 08:45 EDT
Release Explanation: The Empire State Manufacturing Index is a survey of Manufacturing activity in the Fifth Federal Reserve District (It covers New York State, the 12 northern counties of New Jersey and Fairfield County in Connecticut.). It attempts to index economic activity by polling participants in regards to shipments, new orders, capacity utilization, employment, inventory, and raw materials. “The Economic impact of the data has declined over the last two decades as manufacturing activity in the region moves to less expensive areas. However, like the other regional indexes, it will feed into the GDP release”, TheLFB-Forex.com trade team members said.
GDP is directly affected by the manufacturing activity in the country, of which the New York region is a component off. Durable goods and other releases such as Industrial output can be affected by the Richmond Fed activity. “The currency may experience a slight movement on the release, but the significance of the data will be filtered down to Durable Goods and GDP, where the impact may be more significant” TheLFB-Forex.com trade team members said.
Trade Desk Thoughts: Manufacturing in the New York region continued to deteriorate but at a much slower pace in April. The general business conditions index climbed 24 points to -14.7. The new orders index gained 41 points and the shipments index rose 25 points.
Manufacturers indicated that factors other than tight credit were largely responsible for weakness in sales. A majority reported that their sales had fallen more than 10% below their levels in normal times.
Respondents that reported improved conditions in general business rose from 10% last month to 24% in April, while respondents that reported worsening conditions fell from 48% to 39%
Forex Technical Reaction: S&P futures are still slightly negative, while the dollar is trading mixed against the other major currencies. This is only one of several reports that are scheduled for release this morning and it may take some time for traders and trade desks to evaluate the releases.