Manufacturing activity in New York unexpectedly rebounded in October, with an increase in orders driving economic expansion.

Under sustained price pressure, factory activity in the state of New York unexpectedly showed signs of expansion, with the outlook index climbing to its highest level since the beginning of the year. Data released on Wednesday showed that with orders and shipments rebounding, the overall business conditions index for October from the New York Federal Reserve rose 19.4 points to 10.7. A reading above zero on this index indicates expansion in the industry. This monthly volatile data exceeded all expectations of economists surveyed. Indicators reflecting future economic prospects for the next six months surged by more than double, reflecting increased optimism in the market for orders and shipments. Some manufacturers are expected to benefit from more favorable tax policies and investments in business such as artificial intelligence. Due to the increase in U.S. import tariffs raising raw material costs and causing supply chain issues, manufacturing sectors in various industries have had difficulty gaining momentum. The Fed's report shows that the index for raw material prices paid has increased, while the index for prices received by manufacturers in New York State has reached a six-month high. Manufacturers in the state expect inflation to further intensify in the coming months. The index for the outlook on raw material prices paid has risen to one of the highest levels since 2022. Affected by the U.S. government shutdown, official economic data has been temporarily halted, and economists and policymakers will rely more on reports such as these released by regional Federal Reserves to gather clues about economic trends. The Fed announced last week that it had postponed the release of the September industrial production report. In addition to the growth in orders and shipments, the factory employment index also showed its fastest growth in the past three months. Feedback for this survey was collected from October 2nd to 9th.