U.S. manufacturing, services activity expanding rapidly in November: IHS Markit

U.S. manufacturing, services activity expanding rapidly in November: IHS Markit

Reuters  | Nov 23, 2020 10:00

U.S. manufacturing, services activity expanding rapidly in November: IHS Markit

(Reuters) - U.S. business activity expanded at the fastest rate in more than five years in November led by the quickest pickup in manufacturing since September 2014, a survey showed on Monday in an indication the economy keeps making progress at clambering out of the COVID-19 recession even as infections surge.

IHS Markit's manufacturing and services sector purchasing managers' indexes both topped even the most optimistic forecasts in a Reuters poll that predicted both would level off, offering a counterweight to data suggesting economic momentum was slackening after the third-quarter's torrid rebound from an historic plunge last spring.

The readings also offered one of the first pictures of the state of the U.S. economy after a presidential election three weeks ago in which Democrat Joe Biden beat incumbent Republican President Donald Trump.

"The upturn reflected a further strengthening of demand, which in turn encouraged firms to take on staff at a rate not previously seen since the survey began in 2009," IHS Markit Chief Business Economist Chris Williamson said in a statement.

Markit's manufacturing index climbed to 56.7 from 53.4 in October, above the median forecast in a Reuters economists' poll of 53. A reading above 50 indicates expansion.

The services index, meanwhile, rose to 57.7 - the highest since April 2015 - from 56.9 a month earlier. The Reuters poll had pegged the expectation at 55.0.

Markit's composite index - a blend of the manufacturing and services readings - increased to 57.9 from 56.3 in October. It was also the highest since April 2015.

Markit said its subindex for employment also rose at a record pace as well, potentially welcome news in a U.S. job market that still features more than 10 million people without work who had been employed before the COVID-19 pandemic erupted in the first quarter.

With the election now over and subsequent news of successful COVID-19 vaccine candidates, Markit said survey respondents were the most optimistic about the year ahead since May 2014.

Nonetheless, Markit's survey results about current activity are at odds with a number of other recent readings on the U.S. economy that are far less favorable as a result of a resurgence in COVID-19 that has lead to record after record of new daily infections and rising deaths.

Last week, October retail sales reported from the Commerce Department showed the weakest increase in six months, while the Labor Department reported the first weekly increase in new claims for unemployment benefits in a month.

Meanwhile, a clutch of high-frequency indicators tracked by economists for a real-time reading on activity showed further signs of flattening out.

© Reuters. FILE PHOTO: An employee works at the Kirsh Foundry in Beaver Dam

It is clear the U.S. economy in the fourth quarter will come nowhere close to matching 33.1% annualized growth rate in gross domestic product posted in the July to September period, but just how much it has slowed remains less certain. The Atlanta Federal Reserve's "GDPNow" model currently estimates activity in the current quarter expanding at a 5.6% annualized rate.

Related News

Latest comments

Add a Comment
Please wait a minute before you try to comment again.
Discussion
Write a reply...
Please wait a minute before you try to comment again.

Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

English (USA) English (UK) English (India) English (Australia) English (South Africa) English (Philippines) English (Nigeria) Deutsch Español (España) Español (México) Français Italiano Nederlands Português (Portugal) Polski Português (Brasil) Русский Türkçe ‏العربية‏ Ελληνικά Svenska Suomi עברית 日本語 한국어 简体中文 繁體中文 Bahasa Indonesia Bahasa Melayu ไทย Tiếng Việt हिंदी
Sign out
Are you sure you want to sign out?
NoYes
CancelYes
Saving Changes

+

Download the Investing.com App

Get free real time quotes, charts and alerts on stocks, indices, currencies, commodities and bonds. Get free top of the line technical analysis/predictors.

Investing.com is better on the App!

More content, faster quotes and charts, and a smoother experience is available only on the App.