US Economy Storms Ahead In February: Economic Activity and Prices continue to rise fast - despite Interest Rate hikes| World Economics

US Economy Storms Ahead In February

Economic Activity and Prices continue to rise fast
despite Interest Rate hikes

All US Sales Managers Indexes rose in February, most rather sharply, and all bar one are now over the critical 50 no-growth line. The Sales Growth Index rose somewhat dramatically by 5 index points to a 13 month high, sharply reversing the interest rate related drop in January.

US Prices Charged Index: February
Diffusion Index. (50 = 'No Change')

The evidence presented by this February Sales Managers Survey suggests that the Federal Reserve's Interest rate hikes are having only a temporary restraining impact on spending at current levels, although Business Confidence remains clearly muted.

And, despite the Fed's best efforts at cutting price inflation via interest rate rises, the Sales Managers Price index continues to remain around levels not seen as ideal, and indeed rose sharply in February to a far from ideal reading of 55.8.

It's no longer looking likely that 2023 will see price inflation at the elevated levels seen for much of 2022, but it's also on the cards that price increases will continue to be problematic for at least the first half of 2023.

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