The general business activity index deteriorated to minus 10.9 this month from minus 10.4 in November. The consensus was for a minus 6 reading in a survey compiled by Bloomberg.
Production, which the Fed branch calls a key measure of state manufacturing conditions, slumped about 24 points to minus 3.2, indicating a "slight" drop in output. The index for new orders reached minus 6.4 versus 4.8 sequentially.
The shipments index tumbled to minus 10.6 -- its lowest reading in 17 months -- from 15.1 in November, while the employment measure swung to minus 1.1 from 1.2, the data showed.
"Head counts were flat for a second straight month, while work hours declined," Laila Assanie, senior business economist at the Dallas Fed, said in remarks e-mailed to MT Newswires. "Price pressures were little changed, and perceptions of broader business conditions worsened."
The company outlook index fell to minus 11.9 in December from last month's minus 6.3. "Perceptions of broader business conditions worsened in December," the Dallas Fed said.
Six months out, expectations for general business activity were at 10.8 this month, compared with 11 in November. "Other indexes of future manufacturing activity showed mixed movements, but remained in positive territory, indicating increased activity six months ahead," the regional Fed said.
Earlier this month, two separate regional Fed surveys showed manufacturing downturn in the US Mid-Atlantic region unexpectedly worsened in December, while business activity in the Midwest fell more than projected.
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