The June Empire State Manufacturing Survey releases at 8:30 ET today, the only data print on the Monday calendar inside FOMC week. May retail sales print Tuesday at 8:30 ET. The FOMC decision, Summary of Economic Projections, and dot plot release Wednesday at 2:00 ET with the Powell press conference at 2:30 ET. Fed-funds futures closed Friday with the September 17 cut probability at 88% and the 2026 cuts implied by the curve at 1.9, up from 1.5 in the March SEP. Empire State is the first read of the week the Committee carries into the projections.

Where the headline sits going in

The Empire State current general activity index has now printed below breakeven for eleven consecutive months. The May print at minus 8.4 sat in the same range as the prior three reads: minus 7.1 in April, minus 11.9 in March, and minus 8.6 in February. The series has been bounded between minus 12 and minus 7 for four months. That range is the consolidation that built after the January 2026 tariff-pass-through shock pushed the headline to minus 18.4.

Consensus for the June print sits at minus 6.5, the Bloomberg median as of Friday’s close. A print at minus 6.5 or weaker keeps the headline inside the eleven-month consolidation channel. A print above minus 3 breaks the channel to the upside for the first time since the July 2025 reading at plus 1.2. A print below minus 11 breaks it to the downside and lines up with the Philly Fed May minus 0.4 miss as a second regional confirmation of softening.

The component detail is where the headline number gets weighted. New orders at minus 12.6 in May printed the weakest in the regional-survey set; the Philly Fed new orders at minus 1.7 in May confirmed the direction. Shipments at minus 4.6 matched the headline. Unfilled orders at minus 14.2 carried the contraction in the backlog. Employment at minus 2.5 held under zero for the fourth consecutive month, and average workweek at minus 4.0 added to the labor-side softness already visible in May NFP at 88,000.

The prices spread is where the dot plot listens

The line that matters for the Committee inside the FOMC blackout is the prices spread, the gap between prices paid and prices received. The May reading at 52.7 paid minus 34.1 received prints a spread of 18.6, the widest since the January 2026 tariff window. A widening spread signals that input costs are still running ahead of what the regional manufacturing base can pass through to customers; a narrowing spread signals the pass-through is closing.

The prices-paid index has now run above 50 for four consecutive months, breaking the February to April 2025 band that sat in the 30 to 45 range. The shift up matches the April import-price index ex petroleum at plus 0.7% month-over-month and the May PPI at plus 0.18% on services. The prices-received index at 34.1 in May was the highest since November 2024, but the catch-up has not closed the gap.

A June print with the paid index above 55 combined with the received index below 35 widens the spread above 20, the threshold that mapped to the August 2024 margin-pressure window. A narrowing of the spread to 15 or lower, paired with a headline above minus 5, is the configuration the Committee can read as goods inflation cooling without demand breaking. That second configuration is the one the dot plot can support a 2026 median moving to 2.5 cuts against.

Forward expectations split

The six-month-ahead future general activity index at 53.2 in May, the highest reading since June 2021, prints the cleanest split in the manufacturing data. Two-thirds of surveyed firms expect activity to improve, the highest share in five years. The same survey reports current activity at minus 8.4. The future prices-paid index at 70.0 in May ran 17 points above the current paid reading, the widest forward gap in the price series since the first-quarter 2022 energy spike.

The forward optimism is the variable that complicates the read for the September meeting. A current headline that holds below zero with future expectations holding above 50 sits inside the configuration the Committee can use to justify either side of the dot plot. Two cuts gets justified by the current weakness. One cut gets justified by the forward strength. The June print does not resolve the question, but it does set the weighting on what Powell signals at 2:30 ET Wednesday.

Trade detail to watch

The Empire State release reports import and export prices for the regional manufacturing base alongside the diffusion indices. The May import-prices subindex at plus 8.1 and the export-prices subindex at plus 4.7 carried a widening 3.4-point trade-cost spread, the highest reading since the September 2024 print. A June read with the import-prices subindex above plus 10 confirms the April import-price ex-petroleum print as a continuing tariff-pass-through signal rather than a one-month bounce. The Committee carries this read into the 2026 core PCE projection, which sat at 2.7% in the March SEP against a June 27 PCE estimate of 0.17% core in May.

What lines up the rest of the week

Tuesday at 8:30 ET, the May retail sales advance print releases with consensus at plus 0.3% headline and plus 0.4% control group. The control group feeds directly into the Q2 GDP nowcast, which the Atlanta Fed GDPNow carried at plus 1.4% as of Friday’s update. A control-group print at plus 0.5 or higher lifts the nowcast above 1.6% and tightens the dot-plot upside; a print at plus 0.2 or lower holds the nowcast under 1.4% and supports the cut-friendly side.

Wednesday at 2:00 ET, the FOMC decision lands. No rate change is in the funds curve. The Summary of Economic Projections updates the 2026 fed-funds median from the March 4.625% print. A move to 4.375% ratifies two cuts. A hold at 4.625% with the mean moving down to 4.58% prints a softer version of two cuts. A move to 4.875% breaks back to one cut and is the configuration the prices-spread widening above 20 supports.

Thursday at 8:30 ET, the June Philly Fed manufacturing index releases, the second regional read of the week. Friday at 10:00 ET, the Conference Board Leading Economic Index for May prints with consensus at minus 0.2%. The Empire State number today sets the framing the rest of the regional data lands inside.

The single number that moves the morning

The headline at minus 6.5 or better keeps the manufacturing read on the cut-friendly side of the FOMC framing. The prices-paid index at 50 or below signals tariff pass-through is closing. The employment index moving above minus 2 stops the labor-side softening signal from compounding. All three lining up moves the September cut probability from 88% to 92%. None of them lining up holds the probability where it sits. The release prints at 8:30 ET.