Purchasing managers for both goods and services are reporting a strong contraction in orders. The decline in goods has been subtle up to this point, with June and July now reflecting a significant change to the negative. More concerning is the severe change on the service side.
Contraction within business activity is now happening in almost all sectors of the economy.
Bloomberg Reports – US business activity contracted in July for the first time in more than two years as manufacturers and service providers signaled sluggish demand that only adds to heightened recession anxieties.
The S&P Global flash composite purchasing managers output index slid 4.8 points to 47.5, the weakest reading since May 2020, the group reported Friday. Outside of the early months of the pandemic, the July figure is the weakest in data back to 2009. Readings below 50 indicate contraction.
[…] “The preliminary PMI data for July point to a worrying deterioration in the economy,” Chris Williamson, chief business economist at S&P Global Market Intelligence, said in a statement.
“Manufacturing has stalled and the service sector’s rebound from the pandemic has gone into reverse, as the tailwind of pent-up demand has been overcome by the rising cost of living, higher interest rates and growing gloom about the economic outlook,” Williamson said.
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