Highlights
The Philly Fed a couple months ago was the first regional report that showed significant contraction in monthly conditions followed later by the New York Fed and now, dramatically, by the Richmond Fed whose manufacturing index fell to minus 17 to show very deep contraction vs only fractional contraction in June. New orders, the life blood of business, fell to minus 25 vs June's already very weak minus 7. Backlogs, at minus 27, are extending their run of deep contraction.

Shipments show roughly the same degree of contraction as new orders while inventories are on the rise, a build that is likely unwanted given the weakness in orders. One positive, one that may not last however, is relative strength in employment though the Richmond Fed's sample is adding fewer employees than in previous months.

The Richmond Fed report doesn't get much play in the markets but it may today given how extreme these declines are. This report isn't helping the Dow any which is moving to opening lows following today's release.

Market Consensus before announcement
The Richmond Fed manufacturing index contracted in June to minus 3 versus plus 4 and plus 14 in the prior two months. With the exception of employment and wages, details showed significant declines especially the critical areas of new orders and backlog orders. The new orders index dropped sharply to minus 12 in June from plus 1 in May and 13 in April.

Today's release incorporates new seasonal factors not previously published. Prior data to July are likely to differ slightly.

2012 Release Schedule

Released On: 1/24 2/28 3/27 4/24 5/22 6/26 7/24 8/28 9/25 10/23 11/27 12/26 Release For: Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec