Off The Wire
U.S. factory and services activity quicken in November: Markit
(Reuters) - U.S. manufacturing output accelerated in November to its fastest pace in seven months and services activity also picked up more than expected, a survey of purchasing managers showed on Friday in a sign of the continued resilience of the U.S. economy in the face of the U.S.-China trade war and other headwinds.
IHS Markit said its “flash” purchasing managers index for manufacturing rose to 52.2 in November from a final reading of 51.3 in October, while its preliminary services PMI increased to 51.6 this month from 50.6 last month.
Both indexes were at their highest since April and were modestly above the median forecasts among economists polled by Reuters. A reading above 50 signals expansion, while one below that mark indicates a contraction in activity.
Markit’s flash composite index, a blend of the two, rose to 51.9 from 50.9 in October and reaching its highest level since July.
The U.S. economy has slowed this year from 2018’s brisk pace that had been fueled by $1.5 trillion in stimulus from tax cuts and spending. In the third quarter, the economy expanded at a 1.9% annualized rate, and some recent data suggest the pace has slowed further in the fourth quarter as businesses hold back on investment due to uncertainty spawned by U.S. President Donald Trump’s trade war with China and weak demand from abroad.
The U.S. Federal Reserve has cut interest rates three times since July in a bid to prevent the economy, now in a record 11th straight year of expansion, from slipping into recession. No more rate cuts are expected in the near term, however.
The recent weakness has been most pronounced on the manufacturing side of the economy, while the vast services sector, fueled by near-record low unemployment and healthy consumer spending, has proven more resilient.
Reporting By Dan Burns; Editing by Chizu Nomiyama