business activity held steady in March, but prices increased across the board, suggesting that inflation could remain elevated after picking up at the start of the year.
S&P Global said on Thursday that its flash U.S. Composite PMI Output Index, which tracks the manufacturing and services sectors, dipped to 52.2 this month from 52.5 in February. A reading above 50 indicates expansion in the private sector.
The modest slowdown reflected a further cooling in services sector activity. Manufacturing climbed to a 21-month high. The survey suggested that the economy ended the first quarter on solid ground, though the pace of growth probably slowed from the October-December quarter's 3.2% annualized rate.
The United States continues to outperform its global peers, despite 525 basis points worth of interest rate hikes from the Federal Reserve since March 2022 to quell inflation.
The U.S. central bank on Wednesday left its policy rate unchanged at the current 5.25%-5.50% range, but policymakers indicated they still expected to reduce it by three-quarters of a percentage point by the end of this year.
The S&P Global survey's measure of new orders received by private businesses slipped to 52.1 from 52.3 in February. Its measure of prices paid for inputs increased to a six-month high of 58.9 from 55.5 in February. The output prices gauge rose to 56.8, the highest reading since April 2023, from 54.1 in February. Much of the price increases were in services.
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