03:02 PM EST, 01/28/2025 (MT Newswires) -- Manufacturing activity in the US Mid-Atlantic region saw a surprise improvement in January, but remained in contraction territory, data from the Federal Reserve Bank of Richmond showed Tuesday.

The composite index rose to minus 4 this month from minus 10 in December. The consensus was for a no change in the reading for January in a survey compiled by Bloomberg. The latest data showed that Fifth district manufacturing activity remained "soft," the Fed branch said.

The gauge for shipments increased to minus 9 in January from minus 11 last month, while new orders improved to minus 4 from minus 11. The gauge measuring the number of employees swung to 3 from minus 8, the regional Fed's data showed.

The average growth rates of prices paid and received "decreased somewhat" over the last 12 months, the Fed branch said.

Six months out, the index for new orders fell to 31 this month from 43 in December, while the metric charting future shipments dropped to 32 from 41. Still, the indexes remained "solidly in positive territory, suggesting that many firms expected improvements in the next six months," the Richmond Fed said.

The forward-looking employment index rose to 12 from 9. Over the next 12 months, firms expect growth in both prices paid and received to accelerate, according to the report.

New York Fed data released earlier this month showed that New York manufacturing activity posted a surprise drop into contraction territory in January as orders and shipments plunged. On Monday, the Dallas Fed said Texas manufacturing activity unexpectedly rose this month as orders increased.