- US services sector growth at over 6-1/2-year high
- US factory growth remains robust
Today's 'soft' Markit survey data from the US showed that both the manufacturing and services sectors improved slightly this month.
The IHS Markit US Services PMI increased to 60 in March from 58.8 last month which came in line with analysts' expectations. The latest reading pointed to the strongest expansion in the service sector since July 2014.
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Create account Try a demo Download mobile app Download mobile appThe IHS Markit Flash US Manufacturing PMI rose to 59 in March from 58.6 in February, slightly below market forecasts of 59.3. The improvement in operating conditions was the second-fastest since April 2010 amid stronger client demand. New orders jumped to 60.8 vs 57.4 in February which is the highest reading since June 2014 and the ninth consecutive month of expansion.
Source: Bloomberg via ZeroHedge
However, input costs in the service sector rose sharply due to ongoing supply chain issues. The rate of input price inflation was the sharpest since data collection began in late-2009. Firms were able to partially pass higher costs through to clients, however, as selling prices rose at the fastest pace on record
Meanwhile the manufacturing sector also reported the most severe supply chain disruption on record. Amid substantial supplier shortages and input delays, manufacturing firms registered the fastest rise in input costs for a decade and the rate of charge inflation the sharpest on record.
Today's readings are another set of data that point to rising inflation. In the coming months, investors should carefully monitor whether this trend will continue and what steps the Fed will take.
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