The S&P Global US Composite PMI climbed to 53.5 in March 2025, up from February’s 10-month low of 51.6, signaling the strongest expansion in business activity since December 2024, according to a preliminary estimate.
US private sector activity growth picks up
Growth was primarily driven by the services sector, where the PMI surged to 54.3 from 51, partly due to a rebound in business activity following weather-related disruptions earlier in the year.
In contrast, manufacturing activity weakened, with the PMI slipping to 49.8 from 52.7, reversing some of the gains seen earlier in the year that had been fueled by tariff-related demand. Employment levels saw only a modest increase, rebounding slightly after declining in February.
Inflation figures
On the inflation front, input costs rose at their fastest pace in nearly two years, particularly in manufacturing, as tariffs drove up expenses. However, competitive pressures limited the extent to which these higher costs were passed on to consumers.
Meanwhile, business confidence for the year ahead fell to its second-lowest level since October 2022, reflecting increasing caution among firms amid concerns over demand, trade uncertainties, and evolving policies under the Trump administration.
