Latest news with #BusinessActivityIndex
Yahoo
a day ago
- Business
- Yahoo
Pink flags seen as services slips into contraction for first time since mid-2024
-- The Services PMI report, released on Wednesday, showed some early signs of stress for the most significant part of the U.S. economy, as tariff uncertainty weighs. However, the data was likely not weak enough to move the needle on the Fed cutting interest rates. In May, the service sector contracted for the first time since June 2024. The Services PMI showed a slight contraction at 49.9 percent, below the 50-percent breakeven point for only the fourth time in 60 months since the COVID recovery started in June 2020, data showed. This was below April's reading of 51.6 percent and below the consensus of 52. The report showed business activity in the U.S. services sector stalled in May, with the Institute for Supply Management's Business Activity Index holding at 50 percent. This marks the first time the index has exited expansion territory since May 2020, falling from 53.7 percent in April. New orders declined sharply, with the New Orders Index slipping to 46.4 percent from 52.3 percent, signaling contraction. Meanwhile, employment showed modest improvement, rising to 50.7 percent after two months of contraction. Supplier deliveries slowed slightly, as the index increased to 52.5 percent, the sixth consecutive month of expansion. The Prices Index rose to 68.7 percent, the highest level since November 2022, reflecting continued cost pressures. Inventories contracted, falling to 49.7 percent, while inventory sentiment rose to 62.9 percent, the strongest reading since July 2024. Backlogs continued to shrink, with the index dropping to 43.4 percent, its lowest level since August 2023. Ten industries reported growth in May, one fewer than in April. The Services PMI slipped to 49.9 percent, below the 12-month average of 52.3 percent and marking the fourth contraction in the past five years. Businesses across key service industries are reporting growing uncertainty and operational strain due to tariff variability, according to comments in the latest ISM survey. In construction, unpredictable tariffs have disrupted supply chains, particularly for materials sourced from Southeast Asia. Rising costs in refrigerants and steel are prompting HVAC manufacturers to raise prices, complicating long-term project planning. Finance and insurance firms report steady conditions with some growth, while healthcare providers cite federal budget cuts as a constraint on purchasing decisions. In the information sector, unclear tariff duties are prompting firms to delay procurement where possible. Mining companies are seeing moderate price increases on international raw materials, with some suppliers withholding inventory due to uncertainty. While new well production has slowed, activity has shifted toward restimulation projects. Professional services, especially in life sciences, continue progressing on clinical trials and product launches. Though tariffs are being monitored, they have yet to alter strategic direction. Public administration officials noted a slow return of project issuance, tempered by market instability. Retailers report strong demand, possibly driven by consumer concerns over future price hikes. Transportation and warehousing operators are facing higher operating costs tied to tariffs. While firms have attempted to budget for the increases, volatility remains a challenge. Business activity appears to be leveling off, though the duration of this trend is unclear. Utilities firms report growing demand tied to data centers and commercial infrastructure, while residential activity remains subdued. Across sectors, the unifying theme is that tariff-related unpredictability continues to complicate investment and supply decisions. Commenting on the report, Wells Fargo senior economist, Tim Quinlan, said the report paints a weak picture for the services sector, with falling demand likely driven by pre-tariff stockpiling, though it remains unclear if cost pressures will persist or impact hiring. 'The overall report was a bleak read on service-sector activity, but the details mostly reflect the dynamics of a pull-forward in demand ahead of tariffs,' Quinlan said. 'The plunge in demand does not bode well for coming activity, but it's too soon to know if cost pressure will be sustained and its influence on hiring.' He added that May the report doesn't necessarily force the Fed's hand clearly toward either side of its mandate. ING Chief International Economist James Knightley said the disappointment was with new orders. Further, he notes that when you look at the relationship between today's services report and the ISM manufacturing report. '[b]oth are now reporting a clear softening that points to the risk of much cooler GDP growth in the second half of 2025. Related articles Pink flags seen as services slips into contraction for first time since mid-2024 Bond yields fall as rate cut bets rise Fed's hand may be forced as disinflation builds, Macquarie says Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
2 days ago
- Business
- Reuters
Canada's services PMI rises to 3-month high in May as confidence improves
TORONTO, June 4 (Reuters) - The downturn in Canada's services economy eased somewhat in May as firms grew more hopeful that trade and political uncertainty would become less of a drag on activity over the coming 12 months, S&P Global's Canada services PMI data showed on Wednesday. The headline Business Activity Index was at 45.6 last month, its highest level since February and up from 41.5 in April. Still, it remained well below the 50.0 no-change mark that separates growth from contraction. 'Canada's service sector continued to struggle in the face of ongoing tariff and residual political uncertainty during May, with activity and new business volumes again declining markedly," Paul Smith, economics director at S&P Global Market Intelligence, said in a statement. 'That said, there are some hopes of greater stability in the year ahead, with confidence improving since April and helping to support some marginal employment growth as firms look ahead to higher workloads in the months ahead." The measure of employment rose to 50.3 from 47.9 in April, showing job increases for the first time since December, while the Future Activity Index was at 58.9, up from 56.4. Canadian Prime Minister Mark Carney's Liberal Party retained power in April's parliamentary elections, promising sweeping changes to Canada's economy. The nation sends about 75% of its exports to the United States, including autos, steel and aluminum which have been hit with hefty U.S. duties. On Friday, U.S. President Donald Trump said he plans to increase steel and aluminum tariffs to 50% from 25%. Tariffs were reported to have raised the price of some products, contributing to cost pressures that firms attempted to pass on to clients, S&P Global said. The prices charged measure rose to its highest level in one year at 54.6, up from 48.0 in April. The S&P Global Canada Composite PMI Output Index was at 45.5 last month, recovering some ground after it hit 41.7 in April, its lowest level since June 2020. Data on Monday showed a slower pace of decline for manufacturing activity in May. The S&P Global Canada Manufacturing PMI edged up to 46.1 from 45.3 in April.
Yahoo
2 days ago
- Business
- Yahoo
Canada's services PMI rises to 3-month high in April as confidence improves
By Fergal Smith TORONTO (Reuters) -The downturn in Canada's services economy eased somewhat in May as firms grew more hopeful that trade and political uncertainty would become less of a drag on activity over the coming 12 months, S&P Global's Canada services PMI data showed on Wednesday. The headline Business Activity Index was at 45.6 last month, its highest level since February and up from 41.5 in April. Still, it remained well below the 50.0 no-change mark that separates growth from contraction. 'Canada's service sector continued to struggle in the face of ongoing tariff and residual political uncertainty during May, with activity and new business volumes again declining markedly," Paul Smith, economics director at S&P Global Market Intelligence, said in a statement. 'That said, there are some hopes of greater stability in the year ahead, with confidence improving since April and helping to support some marginal employment growth as firms look ahead to higher workloads in the months ahead." The measure of employment rose to 50.3 from 47.9 in April, showing job increases for the first time since December, while the Future Activity Index was at 58.9, up from 56.4. Canadian Prime Minister Mark Carney's Liberal Party retained power in April's parliamentary elections, promising sweeping changes to Canada's economy. The nation sends about 75% of its exports to the United States, including autos, steel and aluminum which have been hit with hefty U.S. duties. On Friday, U.S. President Donald Trump said he plans to increase steel and aluminum tariffs to 50% from 25%. Tariffs were reported to have raised the price of some products, contributing to cost pressures that firms attempted to pass on to clients, S&P Global said. The prices charged measure rose to its highest level in one year at 54.6, up from 48.0 in April. The S&P Global Canada Composite PMI Output Index was at 45.5 last month, recovering some ground after it hit 41.7 in April, its lowest level since June 2020. Data on Monday showed a slower pace of decline for manufacturing activity in May. The S&P Global Canada Manufacturing PMI edged up to 46.1 from 45.3 in April.
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Qatar Living
3 days ago
- Business
- Qatar Living
State Budget Records QR 0.5 Billion Deficit in Q1 2025
The State of Qatar's general budget posted a deficit of QR 0.5 billion during Q1 2025 (January, February, and March), the Ministry of Finance (MoF) announced on Tuesday. In a statement published on its account on the social media platform X, MoF highlighted that the deficit was covered through debt instruments, according to the actual data for Qatar's budget performance in Q1 2025. The total revenues for Q1 2025 stood at approximately QR 49.4 billion, reflecting a 7.5 percent decrease compared to Q1 2024, the statement read. It clarified that these revenues comprised QR 42.5 billion in oil and gas revenues and QR 6.9 billion in non-oil revenues. The statement further noted that total public expenditure during Q1 2025 amounted to roughly QR 49.9 billion, registering a 2.8 percent decline compared to Q1 2024. The expenditure was allocated as follows: QR 16.9 billion for salaries and wages, QR 18.5 billion for current expenditures, QR 13.1 billion for major capital expenditures, and QR 1.2 billion for minor capital expenditures. The statement highlighted that the total value of government procurement contracts executed through tenders and auctions by public entities during Q1 2025 amounted to approximately QR 6.4 billion. Contracts awarded to foreign companies totaled around QR 1.5 billion, marking a 50 percent increase compared to Q1 2024. Overall, MoF stated that the top four sectors according to the Business Activity Index during Q1 2025 were municipality and environment, health, energy, and the General Secretariat of the Council of Ministers. --- Make sure to check out our social media to keep track of the latest content. Instagram - @qatarliving X - @qatarliving Facebook - Qatar Living YouTube - qatarlivingofficial
The Star
06-05-2025
- Business
- The Star
Britain's services sector contracts in April, ending 17-month growth streak
LONDON, May 6 (Xinhua) -- The United Kingdom's (UK) services sector contracted in April, marking the end of a 17-month expansion streak amid mounting global economic uncertainty. The S&P Global UK Services Purchasing Managers Business Activity Index fell to 49 in April, down from 52.5 in March, according to data released Tuesday by S&P Global. The decline follows modest growth in the first quarter of 2025. While many firms continued to cite weak domestic demand, the survey highlighted a notable drop in new work from overseas markets. Export activity was particularly subdued, with new business from abroad falling at the steepest rate since February 2021. "Survey respondents often commented on the impact of global financial market turbulence in the wake of U.S. tariff announcements," said Tim Moore, economics director at S&P Global Market Intelligence. Business expectations for the year ahead deteriorated sharply, as service providers braced for a prolonged period of global economic volatility and increased recession risks, Moore added. The data also showed that the S&P Global UK PMI Composite Output Index fell to 48.5 in April from 51.5 in March, slipping below the neutral 50 threshold for the first time in 18 months.
