by Calculated Risk on 8/17/2012 06:33:00 PM

Below is a graph I usually post after the release of the NY Fed and Philly Fed manufacturing surveys. Most of the economic data this week was a little more upbeat, but both of these surveys were disappointing ...

This week the Philly Fed survey indicated contraction:

The survey’s broadest measure of manufacturing conditions, the diffusion index of current activity, increased 6 points, to a reading of ‐7.1. This marks the fourth consecutive negative reading for the index but also its highest reading since May

And the NY Fed (Empire State) survey was also weak:

The August Empire State Manufacturing Survey indicates that conditions for New York manufacturers deteriorated over the month. The general business conditions index slipped below zero for the first time since October 2011, falling thirteen points to -5.9.

Click on graph for larger image.

Here is a graph comparing the regional Fed surveys and the ISM manufacturing index. The dashed green line is an average of the NY Fed (Empire State) and Philly Fed surveys through August. The ISM and total Fed surveys are through July.

The average of the Empire State and Philly Fed surveys declined in August, and has remained negative for three consecutive months. This suggests another weak reading for the ISM manufacturing index.