April Empire State Manufacturing Survey beats expectations while outlook plunge

Key Concepts:

• Empire State Manufacturing Index
• Import Prices (Headline, Ex-Petroleum, Month-over-Month, Year-over-Year)
• Export Prices (Month-over-Month, Year-over-Year)
• Yields and Bond Market Volatility

Empire State Manufacturing Index (April):

• The index came in at -8.1.
• This was less negative than the expected number of around -14.
• The previous reading was -20, the weakest since January 2024.
• The last positive number was 5.7 in January.

Import Prices (March):

• Headline (Month-over-Month): Down 0.1%.
  • This was less than the expected unchanged (0.0%).
  • Reverses the trend of higher prices seen in January and February (both up 0.4%).
  • The last comparable number was -0.4% in September of last year.
• Ex-Petroleum (Month-over-Month): Unchanged (0.0%).
  • Less than the expected positive number of up 0.3%.
  • The last smaller number was in May 2024.
• Year-over-Year: Up 0.9%.
  • Less than the 1.5% expected.
  • The best number since last month when it was up 2%.
  • The previous month's 2% increase was the highest since 2024.

Export Prices:

• Month-over-Month: Exactly as expected, unchanged (0.0%).
• Year-over-Year: Up 2.4%.
  • The "warmest" number of all the data released today.
  • Represents three solid months over 2%: January (2.7%), February (2.1%), and now March (2.4%).
  • Some of the strongest numbers since the end of 2022.

Yields and Bond Market:

• Yields are not moving significantly.
• The 10-year Treasury yield is at 4.37%, down one basis point.
• Despite talk of volatility in the bond market, the speaker does not see anything in the yield curve that would cause extreme concern about volatility or liquidity ranges.

Synthesis/Conclusion:

The economic data released presents a mixed picture. The Empire State Manufacturing Index, while still negative, was better than expected. Import prices showed a slight decrease month-over-month, reversing a recent upward trend. Export prices, however, were strong, showing continued growth year-over-year. Despite recent volatility, the bond market appears relatively stable, with yields not exhibiting significant movement.