An employee welds a specialized metal product in the shop at the Amuneal Manufacturing plant in Philadelphia, Pennsylvania.

The Philadelphia Federal Reserve's manufacturing gauge tumbled this month, bolstering the case for an easing of the central bank's monetary policy.

The manufacturing index, relesaed Thursday, fell to 0.3 in June from 16.6 in May. That was the index's lowest read since February, when it hit zero. The print also came in well below a Dow Jones estimate of 9.3.

Lower prices contributed to the index's sharp drop, the Philadelphia Fed said. Its current prices-received index, which reflects manufacturers' own prices, plunged by 17 points to 0.6, its lowest level since October 2016.

Manufacturers "suggest weaker regional manufacturing conditions compared with last month," the Fed regional office said, noting that new orders, shipments and employment also fell this month.

The Philadelphia Fed's data came a day after the U.S. central bank opened the door to easier monetary policy in the near future. This led investors to price in a 100% probability of lower interest rates in July.

Investors have been clamoring for the Fed to lower rates as weaker data and persisting trade tensions dampen the global economic outlook.

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