WASHINGTON: US business activity slowed moderately in November amid labour shortages and raw material delays, contributing to prices continuing to soar halfway through the fourth quarter.
Data firm IHS Markit said on Tuesday its flash US Composite PMI Output Index, which tracks the manufacturing and services sectors, fell to a reading of 56.5 in mid-November from 57.6 in October. A reading above 50 indicates growth in the private sector, report agencies.
The services sector accounted for the pull back in activity, with IHS Market noting “some resistance to higher prices.” Though many firms reported business was strong because of increased travel both domestic and international as well as the further easing of Covid-19 restrictions, the pace of growth slowed relative to previous months.
“The US economy continues to run hot,” said Chris Williamson, chief business economist at IHS Markit. “However, the slowdown underscores how the economy is struggling to cope with ongoing supply constraints.”
The survey’s measure of prices paid by businesses for inputs jumped to 78.1. That was the highest reading since the series started in 2009 and followed 74.1 in October. These higher prices are being passed on to consumers, indicating that inflation could remain uncomfortably high for a while.