ANALYSIS: Fresh Data Signal US Economy Facing ‘Stagnation’

The U.S. economy could be facing a “stagnation” point as new data suggest a slowdown is imminent.

A 'for sale' sign is displayed in front of a new home in a housing development as a maintenance worker sweeps the street in Fairfax, Va., on Aug. 22, 2023. Sales of homes in the United States ticked down in July, according to industry data released on Aug. 22, 2023, as elevated mortgage rates and limited housing supply held buyers back. Andrew Caballero-Reynolds/AFP via Getty Images

This summer, U.S. financial markets have largely dismissed recession fears, pointing to a treasure trove of data that depict the national economy in a positive light. But fresh figures indicate that the country could be facing a “stagnation” point.

S&P Global’s flash Composite Purchasing Managers’ Index (PMI), a barometer of business activity in the manufacturing and services sectors, eased to 50.4 in August, down from 52 in July and below the consensus estimate of 52.