U.S. key data review: Philly Fed index declines – Nomura

By FXStreet Analysts at Nomura explained that the Philly Fed index declined to -1.8 in May from -1.6 in April, below expectations (Nomura and Consensus: 3.0) and offered a full review.

Key Quotes:

“The details of the report were broadly weak with seven of the nine subcomponent indices below zero in May. The new orders subindex declined by 1.9pts to -1.9, and the unfilled orders subindex declined to -8.8 from -6.3. The weak orders data point to weak demand for manufactured goods in the near term.”

“The number of employees subindex increased to -3.3 from -18.5 as it appears there were less firms reducing headcount in May than April, but hiring activity appears subdued. The average workweek subindex remained low at -15.1, proving another indication of sluggish activity in May. The prices paid and prices received subindexes, however, increased, likely due to higher commodity prices. The six-month-ahead headline index declined by 6.1pts to 36.1.”

“However, the details were more encouraging for future business investment, with the planned capital expenditure subindex increasing by almost 11pts to 23.6.”

“Overall, another weak report on the industrial sector in May and corroborates the weakness seen earlier this week in the Empire State manufacturing report. But if capital expenditure plans are realized, …read more

Source:: FX Street