US Business Activity Slows to 10-Month Low

The S&P Global US Composite PMI fell to 52.3 in February 2026 from 53.0 in January, signaling the slowest pace of private-sector expansion since April 2025, according to preliminary data. Growth moderated across both sectors, with manufacturing and services activity easing to seven- and ten-month lows, respectively. New orders also softened, while export demand declined at one of the sharpest rates in the past year. Employment increased only marginally for a third straight month, marking the weakest job growth since last April. On the pricing side, input cost inflation edged higher, often linked to tariffs and rising labor expenses, while output prices climbed at the fastest pace since August. Despite the slowdown, business confidence strengthened, with year-ahead output expectations rising to a 13-month high.

The S&P Global US Composite PMI rose to 53.0 in January 2026, above the preliminary 52.8 and December’s 52.7, pointing to a solid expansion in private-sector activity. Output growth strengthened across both manufacturing and services, supported by faster gains in new business. Employment increased only marginally, while business confidence softened. Cost pressures remained elevated, though input inflation eased from late 2025, with a similar moderation in output price growth.

The S&P Global US Flash Composite PMI inched up to 52.8 in January 2026 from 52.7 in December, signalling a modest pickup in business activity, though growth remained subdued relative to the stronger expansion seen in the second half of 2025. Manufacturing growth accelerated (54.8 vs 53.6) to outpace that of services (52.5 vs 52.5), but there were further signs that underlying order book growth has softened in both sectors, led by falling exports. Job numbers remained little changed. Elevated rates of input cost and selling price inflation were again commonly attributed to tariffs, especially in manufacturing, where price pressures intensified. However, service sector inflation moderated, linked in part to intensifying competition. Meanwhile, confidence in the year ahead outlook remained positive but dipped slightly lower, as hopes for sustained economic growth and favorable demand conditions were somewhat offset by ongoing worries over the political environment and higher prices.