After months of contraction, the Philadelphia Fed’s nonmanufacturing sector just did something it hasn’t done since October 2024: post a positive reading.
The regional general activity diffusion index jumped to +7.4 in July, up from a deeply negative -25.8 in June. That’s a swing of more than 33 points in a single month. For context, this index measures whether service-sector firms in Delaware, southern New Jersey, and eastern and central Pennsylvania are expanding or shrinking. Anything above zero means more firms are growing than declining.
The numbers behind the rebound
Firm-level general activity climbed to +17.5 from +2.4 the prior month. Among surveyed firms, 27.8% reported increases in activity while just 10.3% indicated declines.
New orders came in at +12.5, suggesting demand is picking back up across the region’s service economy. Sales and revenues were even stronger, with that index hitting +23.5.
