US Economy Snaps As Richmond Fed Plummets Most On Record

Those seeking an economic indicator of an imminent recession just got one courtesy of the Richmond Fed Manufacturing Index, which tumbled from 14 in November to -8, crushing expectations of a modest rebound to 15, weighed down by drops in the indexes for new orders and shipments.

With analysts expecting the Richmond Fed to print between 12 and 17, the -8 print was a 20 sigma event relative to expectations.

The internals were an unmitigated disaster, with the shipments index print of -25 was its lowest reading since April 2009 even as the third component, the index for employment, rose. Additionally, respondents indicated a deterioration in local business conditions, as this index fell to −25, its lowest reading on record. Most other metrics were dismal:

Shipments fell to -25 after 12 the prior month
Local business conditions printed the lowest on record at -25 after 5 last month
New order volume slowed to -9 after 17 the prior month
Order backlogs fell to -18 after 15 the prior month
Capacity utilization slowed to -16 after 9 the prior month
Inventory levels of finished goods increased to 13 after 2 last month
Inventory levels of raw goods rose to 15 after 5 last month

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