Business activity in the New York–Northern New Jersey service sector remained in contraction in January, with the Business Activity Index improving to -16.1.

• The Business Activity Index rose to -16.1 in January (up 4 pts), with 20% of firms reporting improved conditions and 36% reporting worsening conditions, indicating contraction persisted despite modest improvement.

• The Business Climate Index increased 10 pts to -34.4, with 44% reporting an unfavorable business climate, showing conditions remained broadly “worse than normal.”

• The Employment Index was little changed at -5.5, its fifth consecutive negative reading, suggesting employment continued to decline modestly.

• The Wages Index rose 6 pts to 30.0, pointing to somewhat faster wage growth, though still described as modest.

• Input price pressures eased, with the Prices Paid Index falling 8 pts to 63.9 after reaching a three-year high in the prior month.

• Selling price increases slowed slightly, with the Prices Received Index edging down 3 pts to 27.6, indicating reduced pricing momentum.

• Supply availability was little changed, with the Supply Availability Index at -3.2, suggesting only a slight deterioration.

• The Future Business Activity Index rose to 12.4 (first positive since July), signaling expectations for only modest improvement over the next six months, while capital spending plans remained soft.