US economic activity slows sharply in December, S&P Global says

Economic activity in the US slowed sharply further at the end of 2022, according to the results of two surveys.

S&P Global's Purchasing Managers' Index for US manufacturing fell from a reading of 47.7 in November to 46.2 in December.

In parallel, the services PMI plummeted from 46.2 to 44.4.

Both PMIs missed economists' forecasts of 47.9 and 46.5, respectively, by a wide margin with faster declines in new business the main driver.

A separate PMI tracking output from both sectors also declined significantly, from 46.4 to 44.6.

If one left out the period at the onset of the pandemic, December's composite PMI reading was the joint-fastest since 2009, the survey compiler said.

Selling price inflation on the other hand was only "marginally" faster than the long-run series average.

"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 annualised rate of around 1.5%," said Chris Williamson, chief business economist at S&P Global Market Intelligence.

"Jobs growth has meanwhile slowed to a crawl as firms across both manufacturing and services take a much more cautious approach to hiring amid the slump in customer demand."