S&P Global’s preliminary survey of purchasing managers released on Friday (23) showed that commercial activity in the United States shrank for a third consecutive month in September, although the rate of contraction is moderate, with the supply chain it improved order growth and inflation. contraction of entrepreneurial activity.
The US Markit Manufacturing Purchasing Managers’ Index (PMI) peaked in two months in September, while the service sector and composite PMI both peaked in three months. Although the data was better than expected, this is not the satisfied market, as it means that the United Federal Reserve could raise interest rates more aggressively.
Markit US PMI report for September:
- The starting value of the manufacturing PMI was brought back to 51.8, slightly above market expectations of 51.1, and the previous value was 51.5, the high in 2 months
- The initial value of the PMI service was brought back to 49.2, above market expectations of 45.0, and the previous value was 43.7, the highest in 3 months
- The initial value of the composite PMI was brought back to 49.3, the previous value was 44.6, the highest in 3 months
The composite PMI climbed to 49.3 in September, from 44.6 in August, revealing signs of a weaker and only marginal decline in corporate activity, the slowest in three consecutive months of contraction. manufacturing and services was mild, with a slightly slower pace of decline than in August, while the services PMI fell at a slower pace than the manufacturing PMI.
Looking at the details of the data, new business orders resumed growth in September, from 47.4 in August to 51.2, and the manufacturing and services sectors both experienced broad growth. fastest growth rate since May this year, the recovery the trend is not stable It is not obvious. However, several companies said inflationary pressures continued to weigh on consumer spending, which is still growing at a historically low pace, and new export orders continued to decline, the second fastest decline since May 2020.
The input price index fell to 66.8 in September from 70.5 in August, slowing for four consecutive months and recording the slowest pace of growth since the beginning of 2021, due to the slowdown in the growth of operating costs for manufacturers and service providers. The rate at which companies raised sales prices at the end of the third quarter also slowed as the cost burden grew more consistently.
Furthermore, while new orders only increased, cumulative orders also increased in September, but overall the increase was only slight, but in stark contrast to the sharp decline in August. Manufacturers point out that there are still obstacles in order processing due to disruptions in transportation and supply chains.
On the employment front, overall company wages increased further in September, albeit at a slower pace than in August. The modest increase in the workforce reflects the expansion of staff in the manufacturing and services sectors.
Commenting on the data, Chris Williamson, Chief Business Economist at S&P Global, said that while input cost inflation is cooling, it remains high by historical standards and the survey report paints a picture of a slowdown in the economy. economic activity. in a context of stagnant inflation.
Market reaction
Good economic data is bad news for the market, as it could allow the Fed to raise interest rates more aggressively. Before the deadline,Industrial average of the Dow Jonesfell by 407.57 points or nearly 1.4%,Nasdaq Composite Indexfell 212.95 points or nearly 2%,S&P 500 Indexfell by almost 1.9%,Semiconductor of PhiladelphiaThe index fell nearly 2.6% .US. 10-Year Treasury Yieldcontinued to rise to 3.713%,US dollar indexIt also rose to 111.99.
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