Philly Fed Activity Rises to Five-Month High
Manufacturing activity in the Philadelphia region showed a sharp improvement. The Philadelphia Fed Manufacturing Index rose to 16.3 in February 2026, its highest level since September and far exceeding market expectations of 8.5. This indicator reinforces the signal that the US manufacturing sector still has momentum, although conditions are not uniform across all components.
General business activity and new orders sub-indicators remained moderate and relatively strong, but shipments slowed sharply to near stagnation. On the labor side, employment levels tended to be stable, but the employment index turned slightly negative and average hours worked also decreased—signaling that companies were being more cautious about adding workers or increasing production hours.
Price pressures remained evident, although the pace began to ease. Input costs and selling prices both continued to rise, but the increase was slower than in the previous period. Customer price sensitivity generally remained unchanged, but about a third of companies reported that customers were becoming more sensitive—which could limit their ability to raise prices aggressively.
Looking ahead, six-month growth expectations improved, but capital expenditure (capex) plans actually decreased. The survey also noted that tariffs have had a "mostly negative" impact over the past year, and many businesses expect this negative impact to continue, although competitors are expected to continue raising prices in the next three months.
Source: Newsmaker.id
