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2026-06-25 Economy
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U.S. Manufacturing Production Rises At Fastest Pace in Nearly 5 Years
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[Breitbart] Growth in business activity in the U.S. accelerated for the third consecutive month in June, boosted by strong growth in demand and output in the manufacturing sector.
S&P Global said its flash composite purchasing managers index rose to a five-month high of 52.2 from 51.5 in May. That was a larger increase than economists had anticipated.
The PMIs are derived from surveys of supply chain managers and corporate executives. The preliminary readings are labeled “flash” because they include only a portion of the responses. The composite PMI includes responses from executives in both the services and manufacturing sectors.
The flash manufacturing PMI rose to 55.7 in June, the highest reading since May 2022, from 55.1 in May. This index has been rising for four straight months. A reading above 50 indicates growth in manufacturing. Economists had forecast a decline in the index.
Production growth accelerated to the fastest since July 2021 and new orders showed the largest rise since April 2022.
S&P Global said concerns over supply chains and prices, both related to the Iran war, contributed to the acceleration as businesses stockpiled inventories and components out of precaution. Input purchases rose at a pace not seen since September 2021, according to S&P Global. Inventories of inputs piled up in June at the fastest rate in the near-two-decade survey history—not counting the rise following the announcement of tariffs in 2025.
Building inventories and moving up purchases is a sign of optimism about expected demand. It suggests what some economists call ‘expansionary uncertainty’ is at work, where businesses react to increased uncertainty and potential supply constraints by increasing investment in hopes of capturing market share from rivals or fear losing sales to competitors who have ample inventories.
Growth on the services side remains sluggish despite a significant increase in activity in June. Growth in new orders and output was only “modest,” according to S&P Global. In some cases, growth was bolstered by the World Cup. “Service providers often cited elevated prices, higher interest rates, and low confidence among both business and consumer customers,” the report said.
Supply chains continue to show strain, with delays growing more common in June. Delivery times lengthened to the greatest extent since August 2022. Input costs rose sharply, albeit below the pace set in May. Average prices charged for goods and services rose at a pace matching the hot inflation recorded in May, which had been the highest since July 2025. Cooler, but still elevated, goods price inflation was accompanied by an increase in service sector selling price inflation to an 11-month high.
Payrolls contracted for a second straight month, according to S&P Global. The report says companies focused on cost reduction as input prices rose. The services side of the economy recorded only a modest drop in headcount while the manufacturing sector saw jobs cut at the fastest pace since the pandemic lockdowns. Those numbers contrast highly with the government’s official statistics, which have shown employment growing for three consecutive months through May at an average of 188,000 jobs per month.
| How much of the contraction is due to illegals leaving vs citizens and legal residents being downsized? How much is reduction in federal employment? |
Expectations for output in the year ahead improved in June to the brightest since February, lifting in both manufacturing and services. Improved outlooks were
partly linked to hopes of an easing of war-related disruptions and price pressures. Last week, the U.S. and Iran announced a preliminary agreement to end the war between them.
| Yes, but we’ll see how long the hudna lasts. |
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Posted by NoMoreBS 2026-06-25 00:00||
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