The United States Manufacturing Purchasing Managers Index (PMI) came in at 46.2 in December, down from 47.7 in November, S&P Global revealed in a preliminary report on Friday. The result represents the lowest figure in 31 months.
According to the report, both manufacturers and services saw a further decline in output due to weakening demand, inflation, and rising interest rates. The Flash US PMI Composite Output Index fell by 1.8 index points to 44.6 in December, while The Flash US Services Business Activity Index came in at 44.4 in the last month of 2022.
"Business conditions are worsening as 2022 draws to a close, with a steep fall in the PMI indicative of GDP contracting in the fourth quarter at an annualized rate of around 1.5%," Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, noted while adding that "the survey data suggest that Fed rate hikes are having the desired effect on inflation, but that the economic cost is building and recession risks are consequently mounting."
