Economic Buzz: US S&P Global Services PMI Slumps To Lowest In Almost Two Years In July

4 Aug 2022 , 09:43 AM

Business activity across the US service sector decreased at a solid pace during July, according to the latest S&P Global PMI data. The fall in output was the fastest since May 2020. Although new orders returned to growth, the rate of expansion was historically subdued and much slower than those seen earlier in the year. Subsequently, service providers registered weaker expectations regarding the outlook for output, as confidence dropped to a 22-month low. Nevertheless, companies expanded workforce numbers at a solid pace, with sufficient capacity allowing firms to work through backlogs of work effectively. Inflationary pressures remained historically elevated during July, but eased further. Input costs and output charges increased at the slowest paces for five and 16 months, respectively. The seasonally adjusted final S&P Global US Services PMI Business Activity Index registered 47.3 in July, up slightly from the earlier released flash estimate of 47.0, but down from 52.7 in June. The latest headline reading signalled the fourth successive decline in the seasonally adjusted index, marking a notable contrast seen from the steep expansions earlier in the year. Meanwhile, the S&P Global US Composite PMI Output Index posted 47.7 in July, down from 52.3 in June to signal a renewed contraction in private sector business activity. The decline in output was the first since June 2020 and broad-based. Powered by Commodity Insights