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Edward Bell - Senior Director, Market Economics
Daniel Richards - MENA Economist
Jeanne Claire Walters - Senior Economist
Published Date: 06 June 2023
The US ISM services index remained only factionally above the neutral-50 level, dipping to 50.3 in May from 51.9 in April, to reach a 5-month low. The reading was materially below consensus expectations for a rise in the index to 52.4. The softening in the headline index was driven by declines in all four main sub-components, with the employment index (in sharp contrast to last week’s nonfarm payroll data) dropping to 49.2 in May from 50.8. The headline figure also stands in contrast to the more upbeat assessment coming from the S&P Global US services PMI.
US factory orders rose for a second consecutive month in April, rising 0.4% m/m, but came in below expectations for a 0.8% gain. The bulk of the growth in April was attributable to defense spending. March factory order data was also revised lower to 0.6% m/m from an original reading of 0.9%.
Turkish CPI inflation slowed to 39.6% y/y in May, down from 43.7% in April and marginally higher than the predicted 39.2%. This was the first reading under 40% since December 2021 and is less than half the recent peak of 85.5% hit in October last year. Prices were flat on the previous month, down from a 2.4% gain in April, as the provision of free natural gas in May offset price gains elsewhere. Less positively for the central bank, core inflation rose to 46.6% y/y in May from 45.5% previously, confounding expectations of a slowdown to 43.7%. PPI inflation slowed to 40.8% y/y, from 52.1% previously.
The S&P Global India services PMI remained well above the neutral-50 mark in May but did fall back marginally to reach a value of 61.2, from 62 in April. Despite the small fall, the May reading remains the second-strongest pace of expansion in almost 13 years.
Today’s Economic Data and Events
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