| Consensus | Consensus Range | Actual | Previous | |
| Composite Index | 49.6 | 49.6 to 49.6 | 49.4 | 47.2 |
| Services Index | 49.8 | 49.8 to 49.8 | 49.6 | 46.8 |
Highlights
The private sector economy is flirting with a move into expansion as shown by the composite PMI rising to 49.4 in July from 47.2 in June, helped by an improvement in the services economy to 49.6 compared to 46.8 the previous month.
Preliminary figures and the median of an Econoday survey of economists’ forecasts called for an increase to 49.6 in the composite index and to 49.8 in services.
The composite index, which combines services and manufacturing, was hindered by the manufacturing component which earlier this week slipped into a contractionary reading of 49.8 from 51.2 in June. Nevertheless, the sharp increase in the services index is an overall positive indication. Services are more immune to the conflict in the middle east than is production which relies on energy and global supply chains.
Service providers experienced the first increase in new business since November of last year amid an easing of cost pressures. Business confidence also improved, but respondents are still cautious given the situation in the Middle East.
Although the services economy contracted, there are positive signs emerging and any progress towards a resolution, or even an easing, of the conflict will be welcome and reflected in comping reports.
Market Consensus Before Announcement
The forecast calls for no revision for the composite or services index from the flash at 49.6 and 49.8, respectively, for July. That would be up from 47.2 and 46.8 in June.