Philly Fed Plunges Into Contraction For First Time Since COVID Lockdowns

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by Tyler Durden
Thursday, Jun 16, 2022 - 12:54 PM

Another day, another disappointing macro data point in the US economy. While 'hard' data has been tumbling, we now see the usual optimism-filled 'soft' survey data giving up hope as Philly Fed's business barometer plunged into contraction in June (from +2.6 to -3.3), notably missing expectations of a small rebound to +5.0.

This is the first contraction since the COVID lockdowns of 2020...

Source: Bloomberg

Looking into the details, we see that new orders contracted dramatically, as did the workweek as backlogs are worked through:

  • June prices paid fell to 64.5 vs 78.9

  • New orders fell to -12.4 vs 22.1

  • Employment rose to 28.1 vs 25.5

  • Shipments fell to 10.8 vs 35.3

  • Delivery time fell to 9.9 vs 17.5

  • Inventories fell to -2.2 vs 3.2

  • Prices received fell to 49.2 vs 51.7

  • Unfilled orders fell to -7.0 vs 17.9

  • Average workweek fell to 11.8 vs 16.1

And most troubling of all, the six-month outlook fell to -6.8, its weakest since 2008...

Source: Bloomberg

The Philly Fed is leading the way lower in June across regional Fed surveys...

Source: Bloomberg

Is this what Powell wants?