STIR: Fed Pricing Unchanged Over Weekly Claims, Just Over 50bp Cuts Through Dec

The Philly Fed non-manufacturing index was weak across the board although that included more pronounced signs of limited pricing power. Responses were collected from Apr 7-17 which should give a good assessment of latest US trade policy gyrations. 

• The Philly Fed non-mfg activity index, which specifically asks respondents their assessment of business activity for the region rather than their own firm, fell further in April to -42.7 from -32.5 in Mar, -13.1 in Feb and -9.1 in Jan.
• It was last lower in Apr and May 2020 and otherwise would be a low for a series that started in 2011.
• The firm-specific activity index meanwhile sounds less pessimistic at -26.7 after -17.5, but it tells the same relative story at it third lowest on in the series history.
• There’s a similar story in six-month ahead expectations as well, with both regional and firm-level activity at levels only seen more pessimistic in the depths of the pandemic.
• Back to current conditions, company new orders saw some relative improvement as they increased from -19.5 (lowest since Apr 2023) to -6.9 although full-time employment saw a second consecutive decline (-7.2 in Apr after -7.5 in Mar for largest declines since Aug 2024).
• Importantly though for a Fed that is increasingly saying it will focus on inflation in event of a dual mandate trade-off, prices paid increased further to 46.5 (highest since Feb 2023) but there is clear difficultly at passing these higher costs on with prices received at -0.1 after 8.4 in March. 

• MNI: US REDBOOK: APR STORE SALES +7.0% V YR AGO MO
• US REDBOOK: STORE SALES +7.4% WK ENDED APR 19 V YR AGO WK