Regional manufacturing activity in Philadelphia improved during November, according to the Philadelphia Fed Manufacturing Index, which touched its highest reading since Dec. 2009.
The diffusion index of current activity rose to 22.5 in November from 1.0 in October, according to the report.
The Index, which determines the economic health of the manufacturing sector in Philadelphia, acts as an indicator for the manufacturing conditions in the country.
Indexes for new orders and shipments also rose to 15 points this month, the report stated.
Labor market conditions also showed some improvements, with some growth in employment and longer work weeks.
Unemployment rate in the U.S. has remained high over the past few months, hovering around 9.6 percent. Combined with a low rate of inflation, leading fears of deflation, job growth has remained a strong concern.
The U.S. Federal Reserve announced a second round of quantitative easing in the first week of November to combat deflation fears and spur job growth.
Though the move faced much criticism and led to a weaker dollar, it could help the rate of exports and spur some growth.
In a speech on Wednesday, Eric Rosenbraum, the chairman of the Boston Federal Reserve stated that the QE2, as it is popularly known, will help in the creation of 700,000 jobs by 2012, and reduce unemployment rate by half a percentage point. However, some media reports state that more aid might be required to bring down the unemployment rate to the Fed's target of 7.3 percent.
According to the report, the future general activity rose 8 points to its highest reading in eight months.
The future new orders and shipments indexes also remained at relatively high readings, with about half of the reporting firms expecting growth over the next six months, the report stated.