Price pressure mount in federal reserve focus
The value acceleration was widespread-based. Manufacturing production prices recorded their fastest monthly growth since September 2022, while services recorded the highest increase in allegations since April 2023. These tricks, tied directly to the tariffs on imported goods, pushed the overall selling price at the levels not seen since August 2022- a little focus on the Federal Reserve. The input costs suit with the fastest growth since August 2022 and the highest since June 2023.
Export weakness and labor cut signal underlying fragility
Despite the output benefits, external demand is weak. Exports collapsed in the second consecutive month, with the export of services at the fastest rate from the beginning of 2020, outside the epidemic period. Employment also became negative: Services cut payroll for the second time in four months, and manufacturing recorded a back-to-back decline. These data suggest that the firms are breaking for weak forward demand and margin pressure.
Rebounds of services add support, but demand is still domestic-degeneration
US Services PMI Business Activity Index increased from 50.8 to 52.3 in April. The weakening of foreign sales was mainly operated by strong domestic orders. The confidence of the service sector improved a height of four months, which improved temporary stagnation and development prospects on the new tariff. Nevertheless, the feeling remains below the average of 2024 due to frequent policy and value uncertainties.
Market Outlook: Rapid short -term, inflation risk increases
Flash PMI data indicates a short-term rapid approach to the US output, especially in manufacturing, inventory build-up and fuel by strong domestic orders. However, accelerating the price pressures associated with tariffs increases the risk of inflation headwind, which can accelerate tight fed policy. Traders should look closely to Fed’s reaction and final PMI data in early June.
