Key findings

• Falling output across large parts of manufacturing
• Autos production down for first time in three months
• Weakest rise in Tourism & Recreation activity since January

The latest S&P Global Sector PMI™ indicated that growth became less widespread at the start of the third quarter, with only just over half of the 21 sectors monitored seeing business activity rise in July. The imbalance in performance between manufacturing and services remained evident, with services sectors largely remaining in growth territory but manufacturing categories generally in contraction.

Within services, the main centres of growth were within the wider Financials and Technology categories. Specifically, Other Financials (which includes Financial Services and Investment Services companies), Insurance and Software & Services all posted marked expansions in activity in July. Bucking this wider trend, however, Banks and Real Estate saw activity dip into contraction.

The main areas of weakness continued to be concentrated in manufacturing, in particular within the Basic Materials category and the Construction Materials sector, amid solid reductions in new orders.

The Automobiles & Auto Parts sector saw production decrease for the first time in three months amid a renewed fall in new business. Stocks of finished goods increased for the second time in the past three months, suggesting that current output levels are sufficient to satisfy demand.

Although Tourism & Recreation activity increased again in July, the rate of expansion eased to the weakest since January amid a near-stagnation of new business. Firms subsequently kept their staffing levels unchanged, following a six-month sequence of job creation.

Cost pressures showed further signs of easing, with the number of sectors seeing input prices fall over the month the highest since the opening wave of the COVID-19 pandemic. Selling prices continued to rise, however, in all but those sectors seeing the sharpest falls in demand.