Philadelphia Manufacturing Index Drops to 7.3

anufacturing in the Philadelphia area fell to a 7.3 reading in May, the Federal Reserve said Thursday.

he level, down from 25.3 in April, was lower than analysts had expected, Bloomberg reported. They had forecast a 17.3 rate, with estimates ranging from 5 to 27.

An index number greater than zero signals a higher percentage of the manufacturers surveyed reported an improvement in business than deterioration. The Philadelphia index has been in positive territory since June 2003.

The report said 22% of firms continued to report higher prices for their own manufactured goods, while 6% reported lower prices.

The future new orders index dropped 18 points, while a future shipments index fell 12 points, the Fed said.

The Philadelphia Fed surveys about 100 manufacturers for the index in eastern Pennsylvania, Delaware, and southern New Jersey.