The Richmond Fed Service Sector Activity revenues index eased back to 4 in January from 23 in December. Expectations for revenue remain elevated at 47, a drop of -6 pts. The demand index also eased from 25 in December to 17 in January. Solid demand and local business conditions lead to an acceleration in capital expenditures (+4 pts to 4) and equipment & software spending (+4 pts to 8).

The price indexes reflect elevated inflationary pressures with prices paid up 4.69% YoY and prices received up 3.55% YoY, both about the same as they were in December.