The headline S&P Global US Services PMI Business Activity Index edged higher in October, rising to 54.8 from September’s 54.2. Remaining above the critical 50.0 no-change mark for a thirty-third successive month, the index was consistent with a marked rate of growth that was slightly above the survey trend.
Latest PMI survey data from S&P Global showed that the US service sector registered a solid and accelerated pace of activity growth during October.
Higher service sector output was accompanied by a firm rise in incoming new business, although an uncertain economic and political outlook reportedly meant that hiring growth was modest and confidence about the future fell to a six-month low.
Moreover, selling price inflation was limited by competitive pressures, dropping to its lowest level since April despite elevated cost pressures from tariffs and rising employee expenses.
Supporting growth in activity was a solid, and slightly faster, increase in new business volumes. With activity rising to a quicker degree than overall new work, service providers were broadly able to keep on top of their workloads in October.
Whilst improving since September, the rate of employment growth was only modest amid some reports that leavers were not being replaced.
Although steep, input costs rose to the slowest degree in six months, which helped to explain a similar slowdown in the rate of selling price inflation (also the weakest since April).
The S&P Global US Composite PMI edged up to 54.6 in October, from 53.9 in September. Growth was driven by concurrent upturns in manufacturing and service sector output.
Supporting the rise in overall activity was a solid increase in new business growth. Firms took on additional workers, but only modestly as confidence in the outlook remained subdued, dropping to a six-month low. Prices data showed the slowest increases in costs and selling prices since April.