US and Brazil July PMI readings reveal contrasting economic trends

The United States composite Purchasing Managers' Index (PMI) rose to 54.5 in July, the strongest level since October 2023, according to S&P Global data released on 5 July. The services component reached 54.6, well above the 53.6 consensus, indicating robust expansion. S&P Global chief economist Chris Williamson noted the surge was partly driven by temporary factors such as heightened consumer spending linked to the FIFA World Cup and Independence Day events, as well as reduced geopolitical uncertainty and lower oil prices. He cautioned that rising tensions in the Gulf could soon revive geopolitical headwinds and inflationary pressures.

In Brazil, the services PMI fell to 49.7 in July, slipping below the 50‑point threshold for the first contraction in nine months. The composite PMI, which combines services and industry, dropped to 48.8 from 50.7 in June. S&P Global associate director of economics Pollyana de Lima attributed the decline to project delays, inflationary pressure and weakened demand, while also flagging risks from recent U.S. tariffs and ongoing Middle‑East conflicts. She warned that the Brazilian economy appears headed for a weak third quarter.