US business activity grew at its weakest pace since 2023 amid Trump's tariffs

The April reading of the S&P Global flash composite index, reflecting manufacturing and services sector output in the US, fell 2.3 points to 51.2, according to data released on Wednesday. This marked the lowest pace of business activity growth since 2023.

As noted by Bloomberg, the deterioration of statistics was caused by ambiguous trade policy of the US administration. At the same time, the indicator of future production fell by 3.5 points to the lowest level since October 2022.

According to Chris Williamson, chief business economist at S&P Global Market Intelligence, US manufacturing is generally stagnant. At the same time, he notes, the activity in the service sector is slowing down amid weakening growth in demand for travel and tourism. As the expert explains, any positive effect from tariffs is offset by increased uncertainty, disruption of supply chains, and a drop in exports. 

In addition, the situation is complicated by the acceleration of the increase in selling prices due to tariffs, higher import expenses, and rising labor costs, S&P Global notes. According to the report, manufacturers' input costs rose at the fastest pace since August 2022 as suppliers raised prices due to tariffs and a weaker dollar.