03:47 PM EDT, 08/21/2025 (MT Newswires) -- Manufacturing activity in the US Mid-Atlantic region unexpectedly swung into contraction territory in August, while the prices paid index hit the highest in more than three years, a survey from the Federal Reserve Bank of Philadelphia showed Thursday.

The Manufacturing Business Outlook Survey's headline gauge for activity was at minus 0.3 this month, moving from a positive reading of 15.9 in July, the Fed branch said. The consensus was for a drop to a positive 6.5 reading in a survey compiled by Bloomberg.

The Aug. 11-18 survey showed the share of firms reporting increases and decreases in general activity were evenly split, at 30% each, while 36% reported no change.

The average growth rate of prices paid rose eight points to 66.8, the highest level since May 2022, the regional Fed said. The rate of prices received edged up about one point to 36.1.

"Price increases remain widespread," it said.

S&P Global's (SPGI) flash purchasing managers' index released Thursday showed that tariff-related cost pressures drove the fastest growth in private-sector selling prices over the past three years.

The gauge for new orders moved into negative territory, at minus 1.9, while shipments dropped to 4.5 in August from 23.7 in July. The employment index fell to 5.9 from 10.3.

Six months out, the metric charting new orders improved to 39.2 this month from 30 in July, while the index for shipments rose to 40.3 -- the highest since May -- from 23.6. The forward-looking indicator of local business conditions increased to 25 from 21.5, according to the report.

"The survey's broad indicators for future activity suggest that firms continue to expect growth over the next six months," the Fed branch said.