JPMorgan Econ FI-US July PMIs point to solid growth at the start of 3Q-109402780

NorthAmericaEconomicResearch24July2024JPMORGANwww.jpmorganmarkets.comEconomicandPolicyResearchAbielReinhart(1-212)2704058abiel.reinhart@jpmchase.comJPMorganChaseBankNATheflashJulyS&PGlobalmanufacturingPMIweakenedwhiletheservicesPMIimproved,whichresultedintheall-industryoutputmeasureholdingat55.0inJuly,largelyunchangedfrom54.8inJuneand54.5inMay.Onbalancethereportsdon’tsuggestanybreakineconomicmomentumheadinginto3Q.Theall-industryemploymentmeasuremeanwhilesoftenedabitafterhavingspikedupinJunebutwasbetterthaninAprilandMayandalmostexactlyinlinewiththetrailing12-monthaverage.That12maverageishoweververylowforatypicaleconomicexpansion.Thelastyearhasseensolidpayrollgains,butatthesametimetheunemploymentratehasbeenedgingup.ThelatestPMIemploymentreadingsdon’tnecessarilysuggestthattheunemploymentratewillkeepincreasing,buttheyalsodon’tsignalanimprovementintheenvironmentincomparisontorecentmonths.Expectationsforfutureoutputalsoroseinmanufacturinganddeclinedinservices,butbothmeasuresremainclearlywithintherangeofthepastyearandtheall-industrymeasurewaslittlechanged.Onthepricingside,theoutputpriceindexdeclinedinbothmanufacturingandservices,andtheall-industrymeasureisonlyalittlebithigherthanthe2015-2019average,suggestingsubduedinflationpressures.Formanufacturing,thecompositeindexdeclinedfrom51.6to49.5.Thatisthelowestreadings...