Thought for the day

USA Sales Indexes Show High Interest Rates Cutting into Growth in May

But as yet not significantly reducing price Inflation

12 June 2024
All US Sales Managers Indexes exhibited positive growth in May.

But slower growth than in April, and reported as partially resulting from interest rate increases now biting quite harshly in some areas.

All Indexes remain over the critical 50 “no-growth” line, so the overall picture for May is positive, reflecting a wide spectrum of increasing economic activity. But the outlook for GDP growth over the whole of Q2 looks diminished.

Crucially, the evidence presented by the Sales Managers Survey suggests that the Federal Reserve's Interest rate hikes are having a restraining impact on prices, but price rises still remain too high for comfort. The Sales Managers Price index unexpectedly rose quite sharply in May up to the far from ideal level of 54.8 from the lower April reading of 54.2.
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