Heightened US confidence from factories and builders

AMERICA’S manufacturing and construction industries may be heading toward an improvement, after two prominent indexes pointed to bullish sentiment in the sectors yesterday.

The Empire State manufacturing index, conducted by the Federal Reserve Bank of New York, and the National Association of Home Builders’ (NAHB) market index both outstripped expectations.

The survey of builders suggested that the majority are now seeing improved market conditions, the first optimistic result for over seven years. The index rose to 52, with any number over 50 indicating a positive outlook. It has been trending upward for two years, from as low as 13 in June 2011.

And the New York Fed’s manufacturing index was firmly positive, rising by 9.3 points in June compared to May. The report had showed a decline in March, April and May. Markets had expected stagnation in New York state’s manufacturing outlook.

Amna Asif, an economist for Capital Economics, voiced caution for US manufacturing. “Details of the suggest that factories in the region are still suffering”, adding “the more tangible indices all deteriorated”.

The headline figure for the index is asked to firms as a single question, separate to more precise measures of business performance.