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NY Fed Survey: Inflation Woes Deepen, Outlook Grim
17 Oct
Summary
- Input prices increased sharply, while selling prices rose fastest since 2022.
- Business leaders report a worsening supply availability and a bleak outlook.
- Current business activity declined, hitting its weakest point since March.
Service sector business leaders reported significant pricing challenges in October, alongside a downbeat outlook for future activity, based on a Federal Reserve Bank of New York report. Input price increases remained sharp, while selling prices accelerated to their fastest pace since 2022.
Supply availability continued to worsen, contributing to a business climate described as "much worse than normal." Firms grew more pessimistic about the future, and current business activity weakened, with the headline index dropping to its lowest level since March.
These findings contrast with broader economic data showing strong activity and low unemployment. However, the survey's inflation concerns align with other indicators, influenced by trade tariffs and geopolitical events driving up energy costs.
The survey also indicated weak capital spending plans, with expectations that supply availability will continue to deteriorate. This aligns with other regional data suggesting an uneven economic environment in the New York area.
