Input Stories

The S&P Global Flash U.S. Manufacturing PMI stayed the same in June at 52.0, still above the 50-point marker that signals growth in business conditions. Factory production rose for the first time in four months despite new orders slipping slightly from May’s three-month high. Notably, employment boosted PMI this month and rose at the fastest rate in 12 months. Inventories and supplier delivery times also aided the rise in the manufacturing PMI but at a lesser degree than in the prior month. Input costs rose at the fastest pace since July 2022, with close to two-thirds of manufacturers attributing these higher costs to tariffs. Meanwhile, just over half of respondents linked increased selling prices to tariffs.

Overall business activity dipped slightly to 52.8 in June from 53.0 in May. Declining export orders were a drag on growth, especially in services, which suffered the greatest quarterly contraction since late 2022. As in manufacturing, prices also rose sharply in services, which was largely attributed to tariffs but also to higher financing, wage and fuel costs.

Meanwhile, optimism about future business conditions dipped in June, remaining below the survey’s long-run average but above April’s two-and-a-half-year low. Amid trade worries and anxiety about government policies, companies are broadly less optimistic than they were prior to the inauguration. This concern was most acute for services, while manufacturers were slightly more upbeat.