NEW YORK – Service sector activity slowed in June, according to the Federal Reserve Bank of Richmond service-sector activity survey, released Tuesday, “Retail sales dipped overall and big-ticket sales suffered another drop, despite an uptick in shopper traffic. Inventories declined in June, according to retail merchants. Non-retail services providers' revenues also decelerated. Looking ahead six months, retailers expected the weakness would persist, while contacts at services firms remained optimistic.”
Overall, the service sector revenues index decreased to negative 4 in June, from positive 9 in May, while the number of employees index fell to 3 from 12, the average wage index fell to zero from 22, and the expected product demand during the next six months index slumped to 14 from 20.
The indexes are the percentage of responding firms reporting increase, less the percentage reporting a decrease.
By sector, the retail area excluding services firms reported the sales revenues index slumped to negative 2 in June from positive 3 in May, the number of employees index slipped to zero from 1, while the average wages index declined to negative 8 from negative 1. The inventories index slipped to negative 12 from negative 3, while the big-ticket sales index remained negative 27. The shopper traffic index surged to positive 4 from negative 29, while expected product demand during the next six months held at negative 4.
For services firms excluding retail, the revenues index was negative 8, compared to positive 9 last month, while the number of employees index slid to negative 1 from positive 14, and the average wage index slumped to 6 from 29. The expected product demand during the next six months index fell to 18 from 25.
The current price trend for the two sectors together rose to 0.87 from 0.85, while growing to 1.79 from 1.17 for retail alone and slowing to 0.66 from 0.85 for services, excluding retail.
The expected price trend index for the two sectors together rose to 1.60 in June from 1.43 in May, while increasing to 2.03 from 1.94 for retail alone and jumping to 1.52 from 1.32 for services, excluding retail.
All firms surveyed are located within the Fifth Federal Reserve District, which includes the District of Columbia, Maryland, North Carolina, South Carolina, Virginia, and most of West Virginia.
