New York Manufacturing Activity Contracts Fourth Month Amid Improved Outlook

Manufacturing activity in New York state contracted for the fourth consecutive month in June 2025, with the Empire State Manufacturing Index falling sharply to -16, well below expectations and marking the weakest reading since March. Key indicators such as new orders and shipments declined substantially, while supply availability worsened and delivery times remained stable. Despite the contraction, employment grew slightly for the first time in several months, and firms expressed increased optimism about future business conditions, with the future general business conditions index turning positive after several months of pessimism. Input costs eased somewhat but remained elevated, and selling price increases accelerated, which may raise concerns for inflation. Economists had anticipated a less severe contraction, but the data revealed a more pronounced downturn in current business activity. Overall, while current manufacturing conditions are weak, the improving outlook suggests firms expect a rebound in the coming months.