US business activity growth cools as prices rise on Iran war
The S&P Global flash March composite index fell 0.5 point to 51.4
Add BT as a preferred source
[WASHINGTON] Growth in US business activity slowed in March to an almost one-year low and prices paid for materials and other inputs picked up in the wake of the US-Israel war with Iran.
The S&P Global flash March composite index fell 0.5 point to 51.4, data released on Tuesday (Mar 24) showed. Figures above 50 indicate expansion. A gauge of prices paid increased more than 3 points to the highest level since May.
The decline in the overall composite measure was due to the weakest growth in services activity in a nearly a year. Input prices for services rose to the highest since May, while those for manufacturers jumped to a seven-month high.
“Companies are reporting a hit to demand from the additional uncertainty and cost of living impact generated by the conflict,” Chris Williamson, chief business economist at S&P Global Market Intelligence, said in a statement.
“Travel, transport and tourism related issues are compounded by financial market jitters and affordability constraints, notably including concern over the impact of higher interest rates, surging energy prices and supply chain delays,” he said.
Companies also passed on higher costs to their customers, with the survey showing the steepest rise in selling prices in more than 3 ½ years.
Navigate Asia in
a new global order
Get the insights delivered to your inbox.
Headcount in March contracted for the first time in a year, reflecting a pullback at service providers. New orders growth was little changed and below the pace seen through much of last year.
At the same time, US manufacturing showed further signs of stabilisation. Orders growth was the strongest since October and production accelerated slightly. Manufacturers’ output expectations climbed to a more than one-year high.
Other economies across the globe are also experiencing the fallout from the war in Iran. In the euro area, a composite measure of input prices jumped to a three-year high, while output neared stagnation.
Business activity in India posted the weakest growth since October 2022, while a composite measure of prices paid climbed to an almost four-year high. In Japan, an index of materials costs increased to the highest since April of last year while output growth slowed. BLOOMBERG
Decoding Asia newsletter: your guide to navigating Asia in a new global order. Sign up here to get Decoding Asia newsletter. Delivered to your inbox. Free.
Share with us your feedback on BT's products and services
