Business activity in the US private sector expanded in February, albeit at a softer pace than the previous month, preliminary data suggested on Thursday.
The S&P Global flash composite purchasing managers’ index eased to 51.4 in February’s flash estimate from 52.0 in January.
S&P said output rose marginally as a softer uptick in services business activity weighed on overall growth. Manufacturing, meanwhile, saw a renewed increase in production amid an improvement in supply chains after adverse weather in January.
The S&P flash US services business activity index eased to 51.3 from 52.5 in January, a three-month low.
But the S&P flash US manufacturing output index hit a 10-month high, rising to 52.3 in February from 49.3 in January.
The flash US manufacturing PMI improved to 51.5 in February from 50.7 in January, a 17-month high.
Chris Williamson, chief business economist at S&P Global Market Intelligence said the early PMI data for February ‘indicate that the US economy continued to expand midway through the first quarter, pointing to annualised GDP growth in the region of 2%’.
‘Although service sector growth cooled slightly, manufacturing staged a welcome return to growth, with factory output growing at the fastest rate for ten months,’ he noted.
Williamson said service sector growth has slipped ‘slightly,’ as has confidence in the year-ahead outlook among service providers.
‘It is nevertheless welcome news that both manufacturing and services are expanding again for the first time in three months,’ he concluded.
The US PMI is produced by S&P Global and is based on original survey data collected from a representative panel of around 800 companies based in the US manufacturing and service sectors.
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