Philadelphia-area factory growth slows as selling-price pressures rise
Manufacturing growth moderated in the Philadelphia Federal Reserve’s October survey. The activity index fell from 37.8 to 20.9, while new orders and shipments also weakened but remained positive. Firms reported a stronger rise in their selling prices alongside less widespread input-cost increases. Employment continued to expand, and more than half of respondents expected higher capital spending next year.
Economics & Markets··Morning
Factory activity loses momentum
The Federal Reserve Bank of Philadelphia, part of the US central banking system, reported slower manufacturing growth in its October survey. The general activity index fell from 37.8 in September to 20.9, remaining positive.[1], [2]
More than 41 per cent of firms reported increased activity, compared with 20 per cent reporting decreases. New orders fell 25 points to 4.3 and shipments declined 12 points to 15.3. These seasonally adjusted diffusion indexes subtract the share reporting decreases from the share reporting increases. Responses were collected between October 5 and October 12.[1]
Selling prices rise more widely
The input-price index decreased to 43.2, while the index for firms’ own selling prices increased to 40.1, its highest reading since May 2025. The employment index fell to 9.1 but remained positive. Staffing was unchanged at 68 per cent of firms, while the average workweek index fell to 7.5, its lowest level since June.[1]
Firms plan higher capital spending
In a special question, 52.2 per cent of firms expected total capital spending in 2027 to exceed 2026, while 47.8 per cent expected no change and none expected a decrease. Six-month activity expectations remained positive but weakened. The future general activity index declined to 33.0, its lowest reading since January, while the capital expenditure index stood at 34.9.[1]
