Investing.com - U.S. private sector activity slowed to a 17-month low in September, according to survey data released on Friday.
IHS Markit’s composite output index, which measures the combined output of both the manufacturing and service sectors, fell to 53.4 this month from 54.7 in August.
The services purchasing managers’ index came in at 52.9 this month, down from 54.8 in August.
Economists had forecast the index to slip only to 55.0.
However, the manufacturing PMI rose to 55.6 in September, compared to 54.7 a month earlier.
Analysts had expected a reading of just 55.0.
“With storms hitting the east coast, it was no surprise to see some disappointing survey data in September, with the flash PMI indicating that the pace of economic growth slipped to its lowest for almost one-and-a-half years,” IHS Markit chief business economist Chris Williamson said.
Despite the slowdown, this expert considered business activity to remain “encouragingly resilient” and estimated that the data implied third-quarter growth of about 3%.
Williamson pointed to an acceleration in new order growth and an increase in backlogs of work due to weather-related disruptions and said that “underlying demand remains robust and that there’s an accumulation of work that will roll over into stronger economic growth in coming months.”
He also noted that the upturn in hiring suggested that nonfarm payroll creation could top 200,000 in September.
On the downside, Williamson pointed to the fact that prices charged spiked higher, rising at the steepest rate seen for at least nine years.