Market news

23 June 2021

U.S. private sector business activity expands substantially in June - IHS Markit's survey

Preliminary data released by IHS Markit on Wednesday revealed that U.S. private sector business activity demonstrated a further marked expansion in early June.

According to the report, the Markit flash manufacturing purchasing manager's index (PMI) came in at 62.6 in June, up from 62.1 in May. The latest reading pointed to a record expansion in factory activity. Economists had expected the reading to decrease to 61.5. A reading above 50 signals an expansion in activity, while a reading below this level signals a contraction. Rates of output and new order growth remained well above their respective series averages, although supplier delays and difficulties finding suitable workers led to a softer increase in production among manufacturers. Average supplier delivery times lengthened to the highest extent on record by some margin, while employment growth slowed, as firms struggled to find staff or entice workers back to employment. On the price front, the rate of input cost inflation accelerated to a fresh series record amid broad-based raw material price hikes. Firms increased their selling prices at a quicker rate in an effort to pass on these higher costs, with charge inflation also surpassing all previous records.

The Markit flash services purchasing manager's index (PMI) dropped to 64.8 in June, down from the record 70.4 in the previous month. Economists had expected the reading to slip to 70.0. Thus, the rate of expansion was the second-sharpest since data collection for the series began in October 2009, supported by further upturns in customer demand as pandemic conditions eased further during the month. New business and new export order continued to demonstrate strong growth, while the rate of job creation was the slowest for three months, as struggles among companies to find suitable workers hampered employment growth. At the same time, wage costs and additional transportation fees pushed up cost burdens, which grew at the second-fastest pace on record. Similarly, output prices increase markedly as firms sought to pass on greater input costs to clients.

Overall, IHS Markit Flash U.S. Composite PMI Output Index came in at 63.9 in June, down from 68.7 in May, but nonetheless signaling a historically elevated rate of growth in output across the private sector.

“The early PMI indicators point to further impressive growth of the US economy in June, rounding off an unprecedented growth spurt over the second quarter as a whole,” noted Chris Williamson, Chief Business Economist at HIS Markit. “While both output growth and inflows of new orders have come off their peaks in both manufacturing and services, this is as much due to capacity constraints limiting firms’ abilities to cope with demand rather than any cooling of the economy,” he added.

Open Demo Account
I understand and accept the Privacy Policy and agree that my name and contact details can be used by TeleTrade to contact me about the information I have selected.
23 International Awards
Have a question?

We are ready to assist you in every step of your trading experience
by providing 24/5 multilingual customer support.

Follow us

Risk Warning: Trading Forex and CFDs on margin carries a high level of risk and may not be suitable for all investors. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.42% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Prior to trading, you should take into consideration your level of experience and financial situation. TeleTrade strives to provide you with all the necessary information and protective measures, but, if the risks seem still unclear to you, please seek independent advice.

© 2011-2021 Teletrade-DJ International Consulting Ltd

Teletrade-DJ International Consulting Ltd is registered as a Cyprus Investment Firm (CIF) under registration number HE272810 and is licensed by the Cyprus Securities and Exchange Commission (CySEC) under license number 158/11.

The company operates in accordance with Markets in Financial Instruments Directive (MiFID).

The content on this website is for information purposes only. All the services and information provided have been obtained from sources deemed to be reliable. Telerade-DJ International Consulting Ltd ("TeleTrade") and/or any third-party information providers provide the services and information without warranty of any kind. By using this information and services you agree that under no circumstances shall TeleTrade have any liability to any person or entity for any loss or damage in whole or part caused by reliance on such information and services.

TeleTrade cooperates exclusively with regulated financial institutions for the safekeeping of clients' funds. Please see the entire list of banks and payment service providers entrusted with the handling of clients' funds.

Please read our full Terms of Use.

To maximise our visitors' browsing experience, TeleTrade uses cookies in our web services. By continuing to browse this site you agree to our use of cookies.

Telerade-DJ International Consulting Ltd currently provides its services on a cross-border basis, within EEA states (except Belgium) under the MiFID passporting regime, and in selected 3rd countries. TeleTrade does not provide its services to residents or nationals of the USA.

Material posted here is solely for information purposes and reliance on this may lead to losses. Past performances are not a reliable indicator of future results. Please read our full disclaimer.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.42% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.