US economic activity continued to sink this month amid uncertainty around tariff policy.
New data from S&P Global out Wednesday showed its flash composite PMI output index for April — which captures activity in the services and manufacturing sectors — fell to 51.2, the lowest in 16 months.
Manufacturing activity rose to 50.7, up from 50.2 in March. Services activity fell to 51.4 from 54.4 in March.
Readings above 50 indicate an expansion in activity in the sector; readings below 50 indicate contraction.
Sentiment about the year ahead fell sharply, reaching the lowest level since July 2022 and the second-lowest since Sept. 2020.
“US business activity growth slowed to a 16-month low in April, according to flash PMI survey data, with business expectations about the year ahead also dropping to one of the lowest levels seen since the pandemic,” S&P Global said in a release.
“Prices charged for goods and services meanwhile rose at the sharpest rate for just over a year, with an especially steep increase reported for manufactured goods, linked to tariffs.”
“The early flash PMI data for April point to a marked slowing of business activity growth at the start of the second quarter, accompanied by a slump in optimism about the outlook,” said Chris Williamson, chief business economist at S&P Global Market Intelligence. “At the same time, price pressures intensified, creating a headache for a central bank which is coming under increasing pressure to shore up a weakening economy just as inflation looks set to rise.”
