PMI Shows a Sharp Expansion in US Private Sector Activity

Source: IHS Markit

U.S. private sector companies recorded an extra increase in business activity during July as the growth rate eased for the second consecutive month.

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• The IHS Markit PMI Output Index adjusted for seasonal factors was 59.7 in July, down from 63.7 in June. The growth rate was the slowest in the four months.  
• Manufacturers reported a slight increase in the pace of expansion in production, but service providers recorded an additional loss of growth momentum alongside labor shortages.
• Private sector firms continue to indicate a substantial increase in new business in July. 
• Service sector firms recorded the softest expansion in new orders for five months, as manufacturers recorded a quicker rebound.
• The burden of costs rose significantly again in July. Except for the record-high input, price inflation in May and June, the speed of increase was the sharpest since October 2009.
• July data signaled a new series of record improvements in operating conditions, supported by the rise in new orders across the manufacturing sector as new and existing consumers increased their spending.