S&P Global Apr data shows faster rise in biz activity at firms in US

Solid growth in activity was seen across the manufacturing sector. The headline S&P Global flash US PMI composite output index registered 53.5 in April, up from 52.3 in March, to signal the quickest upturn in business activity since May 2022.

New orders at US firms increased at the sharpest rate for 11 months in April. The rise in new business was solid overall, building on a modest gain in March and contrasting with contractions seen in the opening months of the year, S&P Global said in a release.

Growth was led by the service sector as the upturn in manufacturing new orders was only fractional, albeit returning to expansion for the first time in seven months.

Operating expenses rose at a marked and historically elevated pace that was the steepest for three months. Hikes in supplier prices were often attributed to greater incremental increases in material costs during the month.

Manufacturers and service providers alike recorded sharper increases in cost burdens. Meanwhile, overall output prices rose at the fastest pace for seven months.

Business expectations among US firms remained upbeat during April, with the degree of confidence in the year ahead outlook ticking up to the second-highest since May 2022. The level of optimism was slightly below the long-run series average, however, amid concerns surrounding higher interest rates and inflationary pressures.

The S&P Global flash US manufacturing PMI posted 50.4 in April, up from 49.2 in March, to signal the first improvement in operating conditions at goods producers in six months. The overall upturn was only marginal, but was supported by stronger growth in output and employment, alongside a renewed rise in new orders.

Reports of further and more notable hikes in supplier prices drove up the rate of cost inflation during April. The pace of increase in operating expenses was the quickest since last November. Firms were able to partly pass this through to customers, however, as selling prices increased at a sharp and historically elevated rate.

Marginal decreases in inventories and greater client demand during April led firms to step up their input buying activity for the first time in nine months. Recent supply chain disruption continued to abate, as vendor performance improved to the greatest extent on record (since May 2007).

ALCHEMPro News Desk (DS)