| Consensus | Consensus Range | Actual | Previous | |
| Composite Index | 51.4 | 52.3 | ||
| Manufacturing Index | 51.0 | 50.2 to 51.2 | 52.4 | 51.2 |
| Services Index | 51.1 | 52.3 |
Highlights
The S&P Global US Composite Purchasing Managers' Index preliminary reading came in at 51.4 in March compared to 51.9 in February, and 53.0 in January, another sign of a cooling business activity growth rate down to an 11-month low.
The impact of the war in the Middle East is feeding through, with a weak rise in new orders and a surge in prices. Meanwhile employment contracted for the first time in over a year as employers seek to manage overhead given the highly uncertain outlook.
The service sector was the more negatively affected, while manufacturers reported an upturn in output and new order book growth.
The US Services PMI Business Activity Index recorded 51.1 in March, compared to 51.7 in February, and 52.7 in January.
The Manufacturing PMI's preliminary reading came in at 52.4, compared to 51.6 in February and expectations for 51.0 in the Econoday survey of forecasters.
In the service sector, business activity grew at the weakest pace for 11 months with a weaker rise in new work due to a steepening rate of loss of export sales.
Manufacturing output growth sped up slightly as new orders grew at their fastest rate for five months, while export orders stabilized after falling for eight months. Respondents indicated some softening of the tariff impact on demand, as well as instances of pre-emptive purchase, with factories and their customers keen to secure prices and ensure supply availability.
Employment fell for the first time in over a year the first recorded since February 2025 and reflected a growing caution to add to headcounts across both manufacturing and services.
On the inflation front, prices paid for inputs meanwhile spiked higher, fueled by higher energy prices caused by the war. Overall average input costs rose to the fastest degree for ten months.
Higher costs were passed on to customers to generate the largest rise in selling prices in over three-and-a-half years, S&P said. Rates charged for services rose on average at a rate not seen since August 2022 while goods prices increased at the sharpest rate last August.
Looking ahead, there is mixed sentiment is mixed depending on the sector. In manufacturing, concerns about the conflict were offset by reduced worries over tariffs and hopes of strengthening domestic demand for US-made goods. This pushed growth expectations to their highest for 13 months.
In contrast, confidence among service providers is at its lowest since October 2025, with common concerns including the impact of higher energy prices on the cost of living, higher interest rates, financial market worries and war-related disruptions to travel.
Market Consensus Before Announcement
Manufacturing PMI expected down at 51.0 in March flash from 52.4 in the February final.
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.