The numbers: The New York Fed’s Empire State business conditions index, a gauge of manufacturing activity in the state, fell 18.8 points to negative 24.6 in March , the regional Fed bank said Wednesday.
Economists had expected a reading of negative 5.0, according to a survey by The Wall Street Journal.
Readings below zero indicate contraction in activity. The index has been volatile recently but this is the fourth straight negative reading. The index fell to a low of 32.9 in January before recovering some last month.
Key details: New orders fell 13.9 points to negative 21.7 in March. Expectations of general business conditions six months ahead fell 11.8 points but remained slightly positive at 2.9.
Big picture: Manufacturing is struggling from soft domestic demand as the Federal Reserve raises interest rates.
The Empire index is seen as a precursor of the national manufacturing gauge released by the Institute for Supply Management at the start of each month. The ISM factory index rose slightly to 47.7% in February, staying below the key 50 breakeven mark for the fourth straight month. Manufacturers in the national survey did not express any alarm about business activity, viewing the slowdown as temporary.
Market reaction: Stocks
were set to open sharply lower on Wednesday on fresh concerns over the the banking sector in Europe. The yield on the 10-year Treasury note
fell to 3.52%.