By Kenneth Hunter
NOTE: The following represents the analysis-based opinion of the author and do not reflect those of his employer or any other affiliations.
On July 26th, the Federal Reserve Bank of Richmond published the results of its most recent surveys of manufacturing and service sector activity. Overall, manufacturing in the mid-Atlantic region, which includes North Carolina, slowed down during July, while indicators in the service sector showed improvement.
Manufacturing Survey Highlights (Click Here to Access Report)
- Shipments and new orders both declined in July into negative territory
- Inventories declined slightly, but are still strong
- Employment activity declined, yet remained in positive territory
- Wage growth continued
- Expectations over the next six months indicate less optimism on new orders and activity associated with manufacturing growth
- Raw material prices increased at a 3.4% annual rate in July, and expectations are for another 4.3% increase (annualized) over the next six months
- Expectations show finished prices will increase about 3% (annualized) over the next six months; compared to expectations of a 2% increase last month
- Retail sales increased significantly and expectations of retail demand are strong
- Hiring activity is flat, though wages are improving
- Sales and expectations of activity reflect strong non-retail service sector performance
- Price increases averaged less than 1% annualized growth in July, with expectations indicating prices will only increase about 1.34% (annualized) in the next six months