Markit services PMI
- Prelim was 60.0
- Prior was 59.8
- New orders hit a six-year high
- Rates of input cost and output charge inflation reached fresh record peaks (since 2009)
Here’s the commentary on prices in the release:
On the price front, input costs soared in March. The rate of inflation accelerated to the fastest since data collection for the services survey began in October 2009. Anecdotal evidence widely linked the uptick in costs to higher prices for key inputs such as PPE, paper, plastics, fuel and transportation.
Subsequently, firms sought to pass on higher costs to clients through a sharper rise in selling prices. A number of companies also stated that stronger client demand allowed a greater proportion of the hike in costs to be passed through. The resulting rate of charge inflation was the quickest on record.
The inflation talk isn’t going away any time soon. It will be Q4 before we get any real clarity on whether it’s all just one-off hikes or something that’s going to be sustained.
The eurodollar market is fully pricing in the first Fed hike in December 2022.