Composite SPX global
  • Prior was 52.7
  • Manufacturing 52.3 vs 52.0 expected
  • Prior manufacturing was 52.7
  • Composite 47.5 vs 52.3 prior

Most global PMIs have been on the soft side in today's slate but this is particularly bad. We'd seen some poor manufacturing PMIs so that's where you would expect the weakness to be concentrated but the services PMI is dreadful, it fell off a cliff.


  • Services below 50 for the first time since June 2020
  • Manufacturing new orders at the lowest since May 2020
  • Services sector prices charged index falls to lowest since Mach 2021
  • Composite new orders returned to expansionary following June contraction
  • Composite input costs was softest in six months
  • Composite business confidence slipped to lowest since Sept 2020

This is the kind of thing that will give the Fed pause regarding hiking above 3%. The odds of 100 bps fell to pretty much nil from 10% before the data. The Dec contract is now the high at 3.28% from 3.38% earlier.

The US dollar is falling fast today with a huge bid in bonds.

Commenting on the flash PMI data, Chris Williamson, Chief Business Economist at S&P Global Market Intelligence said:

“The preliminary PMI data for July point to a worrying deterioration in the economy. Excluding pandemic lockdown months, output is falling at a rate not seen since 2009 amid the global financial crisis, with the survey data indicative of GDP falling at an annualised rate of approximately 1%. Manufacturing has stalled and the service sector’s rebound from the pandemic has gone into reverse, as the tailwind of pent-up demand has been overcome by the rising cost of living, higher interest rates and growing gloom about the economic outlook.
“An increased rate of order book deterioration, with backlogs of work dropping sharply in July, reflects an excess of operating capacity relative to demand growth and points to output across both manufacturing and services being cut back further in coming months unless demand revives. However, with companies’ expectations of future growth slumping to the lowest since the early days of the pandemic, any such revival is not being anticipated. Instead, firms are already reassessing their production and workforce needs, resulting in slower employment growth.
“Although supply constraints remained problematic, constraining economic activity, the weakening demand environment has helped to alleviate inflationary pressures. Average prices charged for goods and services consequently rose at a much reduced rate in July, the rate of inflation still running high by historical standards but now down to a 16-month low to provide some much needed good news amid the ongoing cost of living crisis.”