03:53 PM EST, 12/19/2024 (MT Newswires) -- Manufacturing declines in both the US Mid-Atlantic and Midwest regions unexpectedly worsened this month, surveys from the Federal Reserve Banks of Philadelphia and Kansas City showed Thursday.

The Manufacturing Business Outlook Survey's headline gauge for activity fell to minus 16.4 in December from minus 5.5 in November, according to the Philly Fed. A survey compiled by Bloomberg indicated a return to growth territory at 2.8.

Nearly 33% of firms in the Dec. 9-16 survey reported decreases in general activity, up from 23% in November, while 16% reported increases.

The metrics charting new orders and shipments both swung negative at minus 4.3 and minus 1.9, respectively. Orders were at the lowest level since May, the regional Fed said. The employment gauge dipped two points to 6.6 in December. The index for prices paid increased while the prices received index about halved.

Six months out, expectations for general activity dropped about 26 points to 30.7 this month. The future new orders component fell to 51.6 from 66.2 while shipments dipped to 49.7 from 52.1, both remaining above their historical averages. Employment expectations were roughly two points lower month to month.

The Kansas City Fed's composite manufacturing index declined to minus 4 in December from minus 2 in November. The consensus was for the contraction to improve to a minus 1 print, according to a Bloomberg survey. Nondurable goods manufacturing was essentially flat while the durable component "declined somewhat," driven by wood, mineral and primary metal manufacturing, the report showed.

"Regional factory activity fell slightly this month, although it is down substantially again from this time last year," Megan Williams, associate economist at the Kansas City Fed, said. "However, employment grew modestly, and firms' outlook for production and new orders is optimistic."

The production index declined to minus 5 from minus 4 while shipments tumbled to minus 13 from a flat reading in November. The index charting new orders dropped to minus 17 this month from minus 9 in November, the Kansas City Fed's data showed. Both price gauges increased, with raw material prices outpacing selling prices.

Six months out, the seasonally adjusted composite index improved to 18 in December from 11 in November. The future production index climbed to 39 from 24 while shipments and orders both increased to an index level of 35.