US economic activity surges sharply in July

US economic activity grew at the fastest pace in seven months in July, driven by strong gains in the services sector, S&P Global said today, July 24.

Companies raised prices more aggressively amid expectations of rising inflation due to new tariffs.

The composite purchasing managers index (PMI) output rose to 54.6 in July from 52.9 in June, marking the highest reading since December.

Growth remained uneven, with manufacturing output PMI dropping to 51.2 from 53.1, signaling a slowdown in factory activity, while services PMI rose to 55.2 from 52.9, supported by stronger domestic demand.

Business confidence weakened in both sectors, with concerns focused on government policies, particularly public spending and tariff measures.

Firms faced mounting cost pressures in July and accelerated price hikes to consumers, with S&P reporting the steepest increase in selling prices in three years, fueled by tariffs and rising wages.