US Business activity falls to 11-months low amid Middle East tensions

Tuesday 24 March 2026 - 14:15

Business activity in the United States slowed significantly in March, reaching its lowest level in nearly a year, according to a recent survey by S&P Global. The decline comes amid rising geopolitical tensions linked to the conflict involving Iran, which has driven up energy costs.

The report indicates that higher oil and input prices have weighed on companies across multiple sectors. Energy costs have surged sharply in recent weeks, adding pressure to businesses already facing uncertain economic conditions.

The survey’s composite purchasing managers’ index (PMI) showed a noticeable slowdown in overall activity, while business confidence also weakened. In addition, private-sector employment recorded its first decline in over a year, suggesting that companies may be becoming more cautious in their hiring strategies.

Despite these signs of strain, some labor market indicators remain relatively stable, pointing to a mixed economic outlook. Analysts note that while short-term data may fluctuate, broader trends will depend on how long geopolitical tensions persist and how markets respond.

The latest figures have raised concerns about a possible rise in inflation in the coming months, as higher energy prices continue to affect production costs and consumer prices.