Details from the Philly Fed Non-manufacturing report
Business activity 10.6 vs 21.3 prior
New orders 12.6 vs 5.7 prior
Employment 14.3 vs 8.5 prior
Wages and benefits 25.7 vs 40.5 prior
6m expectations 34.2 vs 37.9 prior
A bit of a mixed bag. Employment and new orders higher but wages and expectations fall. Prices paid rose 2 to 16.5 and prices rec'd jumped a hefty 15 ticks to 17.9
There was a special question on how firms saw prices over the next four quarters.
"In this month's special questions, firms were asked to forecast the changes in the prices of their own products and services and for U.S. consumers over the next four quarters (see Special Questions). The median forecast was for an increase in their own prices of 2.8 percent, up from a 2.5 percent forecast in the third quarter when the same questions were last asked.
When asked about the average rate of inflation for U.S. consumers over the next year, the median response was 2 percent, down from 2.5 percent last quarter. Additionally, firms forecast an increase in compensation per employee of 3 percent over the next year, the same value reported in the third quarter. Firms expect the average rate of inflation for U.S. consumers over the next 10 years to be 3 percent, up from 2.5 percent last quarter."
Overall it's a higher expectation for inflation, and that's something Fed members have been raising in various speeches.
