Business growth surges at fastest pace in five years: S&P Global

U.S. business activity surged in September to its fastest pace in over five years, according to S&P Global's Flash PMI released on Wednesday, Sept. 23. The Composite Output Index surged from 56.0 in August to 58.4 in September, marking the fourth consecutive month of accelerating growth and the fastest expansion since July 2021, the report revealed.

The PMI, or Purchasing Managers' Index, gauges the performance of private-sector businesses, with values above 50 indicating economic expansion compared to the prior month, as S&P Global explained. September's headline number was fueled by a rapid growth in service sector output and a boost in manufacturing output, the report detailed.

Service sector output expanded at the steepest rate in over five years, while manufacturing output advanced at the fastest pace since April 2022, according to the company. Furthermore, new order inflows in the service sector hit the highest pace since March 2022, and those in the manufacturing sector hit the highest since April 2022, the report added.

The surge was attributed to domestic demand, as goods export volumes declined and services exports grew modestly. Chris Williamson, chief business economist at S&P Global Market Intelligence, told the report that barring the demand surge following the pandemic-era lockdowns, the latest business activity improvement is the greatest since early 2015.

"Business is clearly booming now in both manufacturing and services," Williamson stated. Recent surveys, including The Conference Board's CEO Confidence Measure (released Aug. 6) and NFIB's Small Business Optimism Index (released Sept. 8), reported a rise in CEO confidence and business optimism, respectively.