| Consensus | Consensus Range | Actual | Previous | |
| Composite Index | 52.8 | 53.0 | ||
| Manufacturing Index | 52.0 | 48.1 to 52.5 | 51.9 | 51.8 |
| Services Index | 52.8 | 52.3 to 54.0 | 52.5 | 52.9 |
Highlights
The S&P Global US Composite Purchasing Managers' Index preliminary reading came in at 52.8 in January compared to 52.7 in December, and 54.2 in November, as the activity growth rate rose at its fastest pace for two months to start the year.
The US Services PMI Business Activity Index recorded 52.5 in January, compared to 52.5 in December, 54.1 in November, and below expectations of 52.8 in the Econoday survey of forecasters. The flash US Manufacturing PMI was 51.9, slightly up from December's 51.8.
Manufacturing growth accelerated to outpace that of services, but the January survey brought further signs that underlying order book growth has softened in both sectors recently, led by falling exports, the report said.
Job numbers consequently remained little changed in January, it added, reflecting worries over rising costs and softer sales growth in recent months. There was a marginal rise in payrolls in the service sector while manufacturing jobs growth slowed to a six-month low.
Confidence in the year ahead outlook meanwhile remained positive but dipped slightly lower, as optimism for sustained economic growth and favorable demand conditions was tempered by ongoing worries over the political environment and higher prices.
Elevated rates of input cost and selling price inflation were again commonly attributed to tariffs, especially in the manufacturing sector, where price pressures intensified in January. However, service sector inflation moderated, linked in part to intensifying competition, the report said.
Market Consensus Before Announcement
The PMI manufacturing is expected nearly flat at 52.0 in January versus 51.8 in December and services at 52.8 versus 52.5.
Definition
The flash Composite Purchasing Managers' Index (PMI) provides an early estimate of current private sector output by combining information obtained from surveys of around 1,000 manufacturing and service sector companies. The flash data are released around 10 days ahead of the final report and are typically based upon around 85 percent of the full survey sample. The report tracks changes in variables such as new orders, stock levels, employment and prices across both manufacturing and services. Production is also tracked, defined as"production" for manufacturing and"output" for services. Results are synthesized into a single index which can range between zero and 100. A reading above (below) 50 signals rising (falling) output versus the previous month and the closer to 100 (zero) the faster output is growing (contracting). The report also contains flash estimates of the manufacturing and services PMIs. The data are produced by S&P Global.
Description
Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. By tracking economic data such as the purchasing managers' manufacturing indexes, investors will know what the economic backdrop is for the various markets. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers less rapid growth and is extremely sensitive to whether the economy is growing too quickly and causing potential inflationary pressures.