FX.co ★ Richmond Fed Reports Modest Demand Recovery

In July 2025, the Fifth District Survey of Service Sector Activity indicated modest improvements, according to the Richmond Federal Reserve. The revenue index rose to 2, up from a previously revised figure of -1, and the demand index increased to 5, compared to -4 earlier. Future outlooks remain optimistic, with the indexes for expected revenues and demand remaining steady. Local business conditions saw a slight enhancement, as the current index improved to -8 from -14, and the future index shifted to a positive 6 from -5. However, there was a softening in employment conditions, with the current employment index slipping to 0 from 2, and the future employment index declining to 4 from 15. Although the wages index decreased to 18, firms still anticipate wage increases over the next six months. Price trends presented a mixed picture: while the growth rate of prices paid decelerated marginally, prices received experienced a modest rise. Companies expect stable input costs but foresee an acceleration in the prices of their own goods and services over the coming year.