Output indicators for US manufacturers and service providers hit record highs in May, highlighting strong demand conditions that exacerbate inflationary pressures.
Data released on Friday showed that the initial, IHS Markit composite purchasing managers' index surged to 68.1 from 63.5 last month, the highest level since records began in 2009. An index above 50 indicates growth.
The main reason for the rise was the record growth rate of the services index. The economic recovery from the epidemic accelerated the rise in demand, bringing vitality to the services sector, especially the leisure and travel sectors, which remained in the doldrums during the epidemic.
Europe is showing a similar situation. In the survey of purchasing managers in the euro zone, the service industry showed the strongest growth momentum in nearly three years.
Orders from US manufacturers also grew at a record high, although shortages of raw materials also led to a new backlog of orders.
In addition, manufacturers' export order indicators reached the highest level in 14 years. Thanks to strong demand at home and abroad, manufacturing and service suppliers can pass on rising input costs. The output price index of manufacturing and services hit a record high.
"companies are optimistic about the outlook, with a sharp increase in the backlog of orders and a continued rebound in domestic and foreign demand, we should be able to maintain strong economic growth throughout the summer," Chris Williamson, chief business economist at IHS Markit, said in a statement.
"the average selling price of goods and services is rising at an unprecedented rate, which will exacerbate consumer price inflation in the coming months," Williamson said. "
Input prices for services and the new business index also rose to record highs.