By Arlenys Tabare
According to data from S&P Global, during the month of April, the preliminary composite PMI for manufacturing in the United States rose to 52.0 from 50.3 in March; Although it represents an expansion in the private sector, the development of the war in Iran with the interruption of supply chains has caused delays in delivery times by suppliers.
The analysis also highlighted that in the month of April, Manufacturing PMI rose to 54.0 from 52.3 in March, not only exceeding the expectations of economists, but positioning itself as the highest level in the last three years. For its part, the PMI for the vast services sector showed an increase, standing at 51.3 from 49.8 the previous month.
In this regard, Chris Williamson, chief business economist at S&P Global Market Intelligence, commented that, in the month of April, The PMI index in general was consistent with the economic situation that has had difficulties in managing an annualized growth of more than 1%, with the vast services sector being the predominant drag, Reuters reported.
On the other hand, data from S&P Global also indicated that this month the producer price index rose to 59.9, compared to 58.1 in March; Although the war in Iran has partly slowed growth, the manufacturing industry was already being affected by the imposition of high tariff rates.
“In addition to shipping-related disruptions due to war, the shortage was also linked to additional purchasing of safety stock,” S&P Global added to the analysis.
Faced with an uncertain economic scenario, Williamson added that “it will probably be increasingly difficult to justify lowering interest rates if inflation follows the path indicated by the PMI, while the economy continues to register modest growth.”
Figures published by The Bureau of Labor Statistics (BLS) reported that inflation for the month of March was 3.3% year-on-year, driven by rising energy prices. The inflation rate data, together with that of the labor market, are one of the most important indicators for the Federal Reserve in terms of decision-making on interest rates, which so far remains unchanged.
Keep reading:
- Retail sales in the US increased 1.7% in March as an effect of the war in Iran
- Manufacturing production in the US decreased 0.1% in March
- Initial jobless claims fell to 207,000 during the second week of April
- Producer prices in the United States increased 0.5% in March due to the war in Iran
