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Inflation concerns and challenging demand conditions weighed on the US private sector in October, the latest flash data from S&P Global showed on Monday.
The headline flash US PMI composite output index registered 47.3 in October, down from 49.5 in September. Consensus, as cited by FXStreet, had expected a reading of 49.1.
The composite figure is calculated using a weighted average of the services and manufacturing readings. Any reading below 50 points indicates contraction.
The S&P Global Flash US services business activity index posted at 46.6 in October, down from 49.3 in September, showing a solid decline in output.
Meanwhile, the S&P global flash US manufacturing PMI dropped to 49.9 in October from 52.0 in September.
"The US economic downturn gathered significant momentum in October, while confidence in the outlook also deteriorated sharply. The decline was led by a downward lurch in services activity, fuelled by the rising cost of living and tightening financial conditions," said Chris Williamson, chief business economist at S&P Global Market Intelligence.
"While output in manufacturing remains more resilient for now, October saw a steep drop in demand for goods, meaning current output is only being maintained by firms eating into backlogs of previously placed orders. Clearly, this is unsustainable absent of a revival in demand," Williamson continued.
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