In the August New York Fed survey, businesses’ 6-month forward outlook has been steadily trending lower since the start of 2012. Just about every component of the future-expectations survey is trending down, including expectations for new orders (forecasting contraction) and hiring expectations (falling to near-neutral level of 3.5 from levels of about 25 earlier in the year).
The Philly Fed survey showed a similar trend of gradual declines in businesses’ expectations for future business conditions. Unlike the NY Fed survey, most components of the Philly survey remain in positive territory albeit lower than earlier in the year. The ‘new orders’ diffusion index registered 18.5 in August vs 26 in July, and employee hiring expectations were stable at +11.
The trend is downward.
sources: Philadelphia Fed survey: http://www.philadelphiafed.org/index.cfm; Empire State (New York) Fed Manufacturing survey: http://www.newyorkfed.org/survey/empire/empiresurvey_overview.html