US economic activity off to "encouraging" start in Q4 but no signs price pressures abating
By Alexander Bueso
Date: Friday 22 Oct 2021
(Sharecast News) - Preliminary survey data revealed that the US economy got off to an "encouraging" start in the fourth quarter but price pressures showed no signs of abating.
IHS Markit's composite output index for US manufacturing and services rose unexpectedly in October, coming in at 57.3 versus a September reading of 55.0 - a three-month high - thanks to "resurgent" services activity.
In parallel, the services sector Purchasing Managers' Index jumped from a reading of 54.9 in September to 58.2 for October.
The manufacturing PMI meanwhile printed at 59.2, which was down from 60.7 in September, a seven-month low.
"October saw resurgent service sector activity as COVID-19 case numbers continued to fall, marking a encouragingly strong start to the fourth quarter for the economy," said IHS Markit chief business economist Chris Williamson.
"[...] However, while manufacturers also continue to report strong demand, factory production remains plagued by constraints, including record supply chain bottlenecks and labor shortages. Prices paid by factories for raw materials rose at yet another new record pace as a result, in turn feeding through to both higher prices at the factory gate and spilling over into higher service sector prices."
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