Morning from Europe.

Another major surprise on the high side in UK inflation, but also here PPIs peak loudly. But before we get to UK inflation, let’s touch upon the details in the Philly Fed Survey yesterday.

The Philly Fed Survey for Manufacturing has stabilized at weak levels, which remain recessionary for the Manufacturing sector. Details have also looked awful for a while.

The newcomer is the weakness in the NBOS, which is the service sector survey conducted since 2011 by Philly Fed. Hiring and hours worked decreased dramatically in June, which is the first time in this cycle.

Is the Service sector finally about to cave in? This is the first sign we actually have of that. VERY interesting indeed and speaks in favour of continued duration bets.

Chart 1: Philly Fed services finally showing signs of weakness