Philly Fed Slides To Weakest Since Election As Employment Sinks

Following Empire Fed’s exuberant six-sigma beat and surge to three year highs, Philly Fed failed to live up to its neighbor’s promise, dropping from 19.5 to 18.9 in August (a small beat of 18.0 expectations).

This is the weakest print since Nov 2016, despite a surge in new orders and average workweek as inventories tumbled and employment slipped.

Hope remains alive and well though.

The diffusion index for future general activity increased from a reading of 36.9 in July to 42.3 this month, its highest reading in four months. Over the next six months, nearly 49 percent of the firms expect increases in activity, and only 7 percent expect decreases.

Notably 7 of the 9 subindices improved… but the headline still declined.