PHILADELPHIA -- The Federal Reserve Bank of Philadelphia reported a modest improvement in its regional manufacturing index for May.

The business outlook survey for the Third Federal Reserve District indicated continued strength in new orders and Shipments, but somewhat less improvement in employment and diminished expectations about growth in the next six months.

The overall index for general activity was 14.8, up from 11.6 in April. The indicator is a diffusion index - the difference between respondents reporting improvement and those reporting declines. In May, 31% gave positive responses and 16% foresaw declines.

The new-order index rose to 19.1 from 18.4 and shipments to 36.7 from 25.7. Current employment fell to 2.0 from 11.1

The overall diffusion index for future economic activity fell to 25.0 from 41.7.

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