Prior month 18.7Current month (December) -3.90Estimate 10.0NY Fed Empire State Manufacturing Index – December OverviewBusiness activity declined slightly in December, following two months of expansion.Headline general business conditions index fell to -3.9, down sharply from last month’s high, turning negative again.New orders and shipmentsNew orders were steady, with roughly one-third of firms reporting increases and about one-third reporting declines.Shipments declined modestly, reflecting softer near-term demand.Supply chain and inventoriesDelivery times shortened, indicating easing supply chain pressures.Supply availability worsened, suggesting renewed input constraints.Inventories increased modestly, pointing to stockpiling amid uncertainty.Employment and hours workedEmployment increased modestly, with the employment index rising to 7.3, its sixth positive reading in seven months.Average workweek edged lower, signaling only limited labor demand momentum.Inflation and pricing pressuresInput price increases slowed for a second straight month, but remain elevated.Prices paid index fell to 37.6, the lowest level since January.Prices received also declined, easing margin pressures slightly but staying historically high.Capital spending and investmentCapital spending plans increased, with the capex index rising to 6.9, signaling modest investment growth.Outlook and business sentimentFirms became increasingly optimistic about the next six months.Future business conditions index rose to its highest level since January.Expectations for future new orders and shipments improved sharply.Firms expect price pressures to remain elevated, while inventories are forecast to expand further.Bottom lineCurrent activity softened, but forward-looking optimism strengthened.Inflation pressures are easing but not resolved, while employment and investment remain supportive of a gradual manufacturing recovery.If you want, I can:Condense this into a one-screen summary, orAdd a market impact section (USD, rates, equities). This article was written by Greg Michalowski at investinglive.com.