US Philly Fed Survey miss - Nomura

Analysts at Nomura noted the miss in the US Philly Fed Survey.

Key Quotes:

"The Philly Fed index fell more than expected to 19.5 in July from 27.6 June (Nomura: 25.0, Consensus: 19.5)."

"The current reading is still high, suggesting that businesses remain optimistic."

"However, the reading is a notable decline from very high readings during the first six months in 2017, during which the index averaged 31.4. The moderation was broad-based across subindexes."

"The new orders index fell 23.8pp to 2.1 and the shipments index fell 16.3 to 12.2, pointing to some slowdown in activity growth. The employment indicator dropped notably. The number of employees index fell 5.2pp to 10.9, while the average workweek index fell 16.7pp to 3.8. 

Although most firms expect continued growth, as suggested by a 5.6pp increase in future general activity index (36.9), concurrent indicators seem to suggest weaker growth."

"Moreover, a moderation in price pressures was reported. Although still positive, the prices paid and price received indexes fell from June. The prices paid index in particular has declined for five consecutive months, suggesting continued easing in price pressures."