Financial data provider IHS Markit announced on Thursday:
- The initial value of the US Markit manufacturing PMI in June was 52.4, a 23-month low and significantly lower than expected 56, with May 57.
- The initial value of the U.S. manufacturing output index in June fell from 55.2 in May to 49.6, and for the first time in two years since the outbreak of the new crown epidemic, it fell below the watershed of 50.00.
- The initial value of the US Markit service industry PMI in June was 51.6, a five-month low, and was also lower than the expected 53.5, with a May 53.4.
- The U.S. comprehensive service and manufacturing industry PMI initial value in June was 51.2, a five-month low, and 53.6 in May.
Previously, multiple macro data in the United States collapsed, and analysts only expected that the initial value of the US Markit manufacturing PMI in June would drop slightly, which may be a bit surprising, and the actual data released showed that this surprise was correct. Although the manufacturing PMI is still above the 50 boom and bust line, the expansion rate is the slowest since the beginning of the year.
commented that even if the United States has not yet fallen into a recession, PMI released a signal of more worrying, as growth in some economic sectors slowed significantly, especially manufacturing activity.
Amid the backdrop of high inflation, rising interest rates, slowing demand and lingering concerns about supply chains, companies have also lowered their expectations for the economic outlook for the coming year.
Chris Williamson, chief business economist at Standard & Poor's Global Market Intelligence, said in commenting on PMI data:
"The U.S. economic growth slowed down sharply in June, and deteriorating forward-looking indicators predicted a contraction in the third quarter. The survey data is consistent with the June annualized economic growth rate of less than 1%, the commodity production sector has been declining, and the huge service industry has slowed significantly."
"After the easing of epidemic prevention restrictions, the return of consumers has brought a brief boom, but many service companies are now seeing that it is becoming increasingly difficult for families to cope with rising cost of living, and orders from non-essential manufacturers have also experienced a similar decline."
"So, demand for goods and services has dropped significantly compared to the previous months.
"As a result, companies have significantly increased their concerns about the outlook due to rising cost of living and lower demand, as well as the increasingly radical rate hike proposed by the Federal Reserve , and the subsequent deterioration of overall financial conditions. Business confidence is currently at a level that usually indicates a recession, increasing the risk of a recession. The inevitable result of the decline in demand is a decrease in price pressure. The inflation indicators that measure corporate costs and sales prices in the survey fell sharply in June, indicating that price pressure has peaked despite still being high. "After the announcement of
PMI, the market's expectations for aggressive interest rate hikes in the Federal Reserve cooled down. The chances of 75 basis points respectively in July and September this year fell to 68% and 22% respectively, and the chances of 25 basis points each hikes in December this year and February next year fell sharply. Some comments said that market pricing seems to be expected to end the interest rate hike cycle before the US midterm elections in November this year.
Under the influence of the "double" turn of the above market expectations, the benchmark 10-year US Treasury bond yield accelerated intraday decline. US stocks once approached 3.00% in the early trading, hitting a new low for two weeks. Rejected two weeks ago, the US CPI announced that the US May CPI exceeded expectations and hit a new high in 40 years of growth.
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