U.S. economic activity slumped in April, with S&P Global’s flash composite PMI dropping to a 16-month low of 51.2, driven by uncertainty over tariff policies.
Services activity fell to 51.4 from 54.4, while manufacturing edged up to 50.7.
Business optimism hit its lowest since July 2022, reflecting fears of economic slowdown.
Rising tariffs fueled a sharp increase in goods and services prices, the highest in over a year, complicating Federal Reserve policy.
Chris Williamson, chief business economist at S&P Global Market Intelligence said, “The early flash PMI data for April point to a marked slowing of business activity growth at the start of the second quarter, accompanied by a slump in optimism about the outlook,” adding, “At the same time, price pressures intensified, creating a headache for a central bank which is coming under increasing pressure to shore up a weakening economy just as inflation looks set to rise.”
Slower growth and heightened inflation pressures signal reduced oil demand, potentially pushing prices lower in the coming months as economic headwinds intensify.
