WASHINGTON, June 23 (Reuters) – Growth in U.S. private sector activity slowed in June as high inflation and waning household confidence dampened demand across all sectors, dragging a contraction in the new orders index for the first time in almost two years.
The composite “flash” PMI index fell to 51.2, the lowest in five months, after 53.6 in May.
The composite orders index fell to 47.4, falling below the 50 mark separating expansion and contraction for the first time since July 2020, after 54.9 in May.
As orders collapsed, business confidence plunged to its lowest level since September 2020.
“Confidence is now at a level that generally indicates an economic slowdown, which adds to the risk of recession,” said Chris Williamson, chief economist at S&P Global Market Intelligence.
For manufacturing activity, the PMI index fell to 52.4 against 57.0 in May and 56.0 for the Reuters consensus.
The factory production sub-index plunged to a 24-month low as “weak demand, inflation, shortages of raw materials and delays in deliveries led some customers to halt or reduce purchases of goods “.
The PMI for the services sector fell to 51.6 in June from 53.4, while the Reuters consensus gave it an improvement of 53.5. (Report Lucia Mutikani, French version Laetitia Volga, said by Kate Entringer)
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