- Three-month low
- Prior was 52.3
- Manufacturing 52.5 vs 51.7 expected
- Prior manufacturing was 52.2
- Composite 52.2 vs 52.5 prior
This is a small miss but the direction is lower, highlighting some subtle weakening in the US economy.
Commenting on the data, Chris Williamson, Chief Business
Economist at S&P Global Market Intelligence said:
“Further expansions of both manufacturing and service
sector output in March helped close off the US
economy’s strongest quarter since the second quarter of
last year. The survey data point to another quarter of
robust GDP growth accompanied by sustained hiring as
companies continue to report new order growth.
“The brightest news came from the manufacturing sector,
where production is now growing at the fastest rate since
May 2022. Production gains are linked to improving
demand for goods both at home and abroad, driving a
further upturn in business confidence in the outlook.
“Service providers meanwhile reported a slower pace of
expansion than factories, with the rate of increase also
moderating slightly compared to February, linked in part
to ongoing cost of living pressures. However, service
providers have also become increasingly optimistic about
the outlook, with confidence striking a 22-month high in
March to suggest the broad-based economic expansion
seen in March will persist into the summer.
“A steepening rise in costs, combined with strengthened
pricing power amid the recent upturn in demand, meant
inflationary pressures gathered pace again in March.
Costs have increased on the back of further wage growth
and rising fuel prices, pushing overall selling price
inflation for goods and services up to its highest for nearly
a year. The steep jump in prices from the recent low seen
in January hints at unwelcome upward pressure on
consumer prices in the coming months.”
There is some modest US dollar buying on this report with Treasury yields now near the highs of the day.