Business Confidence is improving – index data

US private-sector output growth in June rose to its highest level since April 2022, led by the services sector as price pressures eased while business confidence for the year ahead improved, according to S&P Global's (SPGI) flash purchasing managers' index released Friday. The composite output index edged up to 54.6 this month from 54.5 in May, above the 53.5 consensus in a survey complied by Bloomberg. The 50-point mark separates expansion from contraction. Output has now increased for 17 straight months, with the expansion rate having improved "markedly" in May and June, S&P Global said. "The PMI is running at a level broadly consistent with the economy growing at an annualized rate of just under 2.5%," S&P Global Market Intelligence Chief Business Economist Chris Williamson said. "The upturn is broad-based, as rising demand continues to filter through the economy." Service sector output increased to a 26-month high of 55.1 in June from 54.8 last month, while manufacturing PMI rose to 51.7 -- a three-month high -- from 51.3. Wall Street was looking for 53.4 and 51, respectively. New work inflows into the service sector increased at the sharpest pace for a year amid growing domestic demand, while export orders dropped at the slowest rate seen over the last five months, the survey showed. Employment increased for the first time in three months, while survey's measure of selling price inflation dropped, tied to slower input cost growth. One year out, overall optimism regarding output rose to a three-month high this month, as service sector outlook hit a five-month high, though optimism in manufacturing dropped to its lowest for just over one-and-a-half years, the survey showed.