September’s flash PMI surveys revealed an increasingly uneven global economy. Business activity accelerated sharply in the US, India gathered momentum, and the eurozone recorded its strongest growth for almost three-and-a-half years. Expansion continued in Japan, the UK and Australia, but all three lost pace.

Headline composite readings ranged from 58.4 in the US and 56.5 in India to 53.1 in the eurozone, 52.5 in Japan, 51.7 in the UK and 50.8 in Australia. All six readings remained above the 50 no-change mark. Yet the headline numbers concealed a much wider divide in demand, hiring and factory activity.

Higher energy bills ran through almost every survey. Companies in the US, eurozone, UK, Australia and Japan linked rising costs to energy markets or the Middle East conflict. India broke the pattern at the composite level, although its manufacturers still reported firmer price pressures.

Supply chains were moving in different directions too. Delivery times lengthened in the US, eurozone, Australia and Japan, while Indian manufacturers reported faster deliveries and higher stock levels. For multinationals, that divergence reaches directly into receivables, supplier-payment schedules and local liquidity needs.

US boom meets a broadening eurozone recovery

American private sector output grew at its fastest rate since July 2021. The US composite index jumped from 56.0 in August to 58.4, extending an acceleration that has now run for four months. Services activity reached 58.7, its strongest reading for 59 months, while manufacturing output climbed from 53.1 to a 53-month high of 56.7.

Factory conditions improved across every component of the manufacturing index. Its headline reading rose from 53.9 to 57.0, the highest since May 2022, as production revived, new orders strengthened, employment increased, and inventories grew. Services remained the larger engine of the expansion, but September’s factory rebound made the upturn considerably broader.

Chris Williamson, chief business economist at S&P Global Market Intelligence, said the survey implied an unusually rapid pace of growth: “US business continues to boom, with output growing at the fastest rate for over five years in September. Historical comparisons suggest that the latest survey data point to annualised growth of around 5% with a 4% gain now signalled for the third quarter as a whole.”

Demand was principally domestic. Service-sector new orders rose at the fastest rate since March 2022, and manufacturing orders recorded their strongest increase since April of that year. Goods exports continued to fall, however, while overseas demand for services increased only modestly, leaving international sales well behind the domestic expansion.

Companies were also running closer to their operating limits. Backlogs accumulated at the sharpest rate since May 2022, encouraging the strongest rise in employment since June 2022. Manufacturing payroll growth reached its highest since February 2021, while services companies also stepped up recruitment.

Price and supply-chain strains intensified alongside the boom. Input cost inflation across goods and services was the highest since October 2022, driven by fuel, transport and stronger wage pressures. Service-sector cost inflation reached its steepest rate since November 2022, while manufacturing suppliers’ delivery times lengthened more than since July 2022.

Selling prices rose faster than in August, though the pace remained below the rates recorded between March and July. Backlogs and hiring point to continued activity, but shortages and higher costs also give businesses more scope and reason to raise prices. For companies, the cash-flow picture is less straightforward: stronger sales are arriving alongside higher payroll, transport and input bills, while backlogs of uncompleted orders build.

Confidence has been steady since returning to its pre-conflict level in recent months. Manufacturers were close to their long-run average for optimism, supported by demand and expansion plans. Sentiment among service providers remained well below trend because of concerns about living costs, borrowing costs and political uncertainty.

The eurozone recovery also gathered pace. Its composite index rose from 52.0 to 53.1, the highest since April 2023 and consistent, on the survey’s historical relationships, with quarterly GDP growth of around 0.4%. Manufacturing output reached a 55-month high of 53.4, and services activity advanced to a ten-month high of 53.0.

Growth also became more geographically balanced. Germany expanded for a third month and at its quickest pace for almost a year. France returned to growth for the first time in ten months, while activity across the rest of the currency area increased solidly, albeit more slowly than in August.

Order books provided the strongest evidence that momentum could continue. Total new business grew at its fastest rate since May 2022. Export orders, including trade within the eurozone, increased for a second consecutive month after falling throughout the previous 53 months, with manufacturing responsible for the improvement as services export demand continued to contract.

Backlogs rose for the first time since June 2022 across both manufacturing and services. Recruitment remained cautious by comparison, increasing only modestly for a second month. German employment registered its strongest rise since mid-2023, but France cut jobs again, and eurozone manufacturers collectively left workforce numbers unchanged.

Price pressures strengthened alongside activity. Input costs and selling prices rose at their fastest rates since May, with both measures accelerating across manufacturing and services and output charges also rising more quickly in Germany, France and the rest of the eurozone. Confidence nevertheless slipped to a three-month low, largely because French companies became less optimistic.

Williamson said the eurozone PMI data would “likely embolden the ECB to hike interest rates again before the end of the year”, putting an October increase firmly in play.

UK loses momentum as price pressures build

The UK faced a much less comfortable mix: growth weakened as inflation intensified. Its composite index fell from 52.5 to a three-month low of 51.7, with both manufacturing output and services activity losing momentum. S&P Global said the resulting pace was consistent with economic growth of about 0.1% during the quarter.

Service companies linked the slowdown to subdued domestic conditions and geopolitical uncertainty, although technology demand provided some support. AI investment and defence spending helped manufacturing production, but weaker consumer demand limited the overall advance. Factory output rose at its slowest rate since the current expansion began in April, even as the broader manufacturing PMI edged up to a three-month high of 52.0.

Order books were weaker than the output figures suggested. Total new work fell fractionally after marginal gains in July and August, led by a renewed decline at services companies. Export sales contracted at the fastest rate since June, while manufacturing export orders fell for the first time since December 2025, often because of weaker sales to EU customers.

Employment fell for a twenty-fourth consecutive month, although September’s reduction was marginal and much smaller than the average decline during the first half of 2026. Service providers cited high costs, efficiency gains and spare capacity. Manufacturers increased employment for a sixth month as backlogs rose at their fastest pace since January 2022.

Cost pressures accelerated for a second month. Input price inflation reached a three-month high as companies reported higher fuel, energy, labour and raw material costs, particularly copper and steel. Selling prices also rose at their quickest pace since June, raising the prospect of further pressure on customers despite soft order books.

Williamson said the firmer price gauges would probably keep the Bank of England hawkish, but warned that “the worryingly lacklustre pace of business growth underscores the risk to the economy from higher borrowing costs.”

The UK’s contrast with the eurozone was especially pronounced. Both entered September with their composite indices above 50, but eurozone orders grew fastest since May 2022 as UK orders slipped into contraction. Euro area export business rose, while UK exporters fell faster, leaving UK companies with less demand strength to absorb the latest cost increases.

India accelerates as Japan and Australia slow

Manufacturing propelled India to the strongest reading in the Asia-Pacific flash PMI data. The HSBC composite index increased from 54.3 to 56.5, its highest since June and above its long-run average. Services activity improved to 55.8, while manufacturing output surged from 54.8 to 58.2 and the headline factory index reached a seven-month high of 55.7.

Domestic orders accelerated in both sectors, with manufacturers recording the larger improvement and their strongest sales growth for seven months. Demand strengthened across industries ranging from property, travel and transport to software, electronics and pharmaceuticals.

Exports were the soft spot. New overseas orders continued to rise, but at their weakest pace in almost three years as services lost momentum, although manufacturers recorded a marginal acceleration. Respondents identified business from Brazil, Europe, the UAE and the US.

Companies added staff across both sectors, yet backlogs barely rose after two months of decline, suggesting they still had capacity to absorb most of the additional work. Confidence in output over the coming year reached a four-month high.

India also stood apart on costs. Composite input price inflation eased to its lowest since January as softer service-sector pressures outweighed an increase among manufacturers. Overall selling price inflation was broadly unchanged, with faster factory-gate increases offset by a weaker rise in service charges.

Inventories told the clearest story about how manufacturers were responding to geopolitical risk. Stocks of inputs and finished goods rose even as supplier lead times shortened.

Pranjul Bhandari, chief India economist at HSBC, linked that stock-building to the external backdrop: “Renewed tensions in the Middle East have once again led firms to build buffers to manage the uncertainties. Input purchases picked up pace and the stocks of finished goods index is now at an 11-and-a-half-year high.”

Japan continued to expand but slowed. Its composite index declined from 53.5 to a four-month low of 52.5, marking an eighteenth successive month of growth. Manufacturing remained in front, with its headline PMI at 54.1 and output at 54.9, while services activity eased to a modest 51.6.

New orders grew more slowly in both sectors, largely because domestic demand softened. Exports were the bright spot, as orders rose markedly, matching August’s eight-and-a-half-year high. Manufacturing drove that strength, while service providers saw another drop in international demand.

Inflation eased only marginally. Input cost growth remained historically strong as the weak yen and conflict in the Middle East lifted imported energy and goods costs, alongside higher spending on staff and transport. Selling price inflation was only slightly below the survey record reached in August.

Hiring accelerated to a seven-month high, extending Japan’s run of job creation to three years. Outstanding work also rose at its fastest rate in seven months. Confidence reached its highest since February and moved above its long-run average.

Annabel Fiddes, economics associate director at S&P Global Market Intelligence, said: “Upbeat forecasts have been widely linked to the ongoing boom in AI-related demand, including in semiconductors, while firms also anticipate greater sales in areas such as defence and automobiles. Nevertheless, firms expressed concerns that high prices and relatively sluggish domestic demand could dampen performance.”

Australia came closest to stagnation. Its composite reading dropped from 52.7 to 50.8, the weakest expansion of the third quarter, while services activity slowed for a second month to 51.4. Manufacturing returned to contraction at 49.3, and factory output fell to 46.4, its steepest decline in 21 months.

Softer demand drove the loss of momentum. Total new business rose at its weakest rate during the current three-month expansion, manufacturing orders contracted, and export business declined for the fifth time in six months. Service growth kept the private sector above the no-change mark but offered less support than earlier in the quarter.

Employers reduced staff for the first time since May. The fall was modest but the strongest since October 2020 and extended across manufacturing and services. Business confidence weakened to a three-month low as companies raised concerns about economic conditions, costs, demand and customer retention.

Input price inflation reached a three-month high, and companies raised their charges more sharply than in August. Fuel and energy costs linked to the Middle East conflict were widely cited. Price growth remained much softer than during the second quarter, although manufacturers faced longer delivery times and greater supply disruption.

Eleanor Dennison, economist at S&P Global Market Intelligence, said: “Although only slight, the economy managed to sustain the trend of expansion over the quarter, an improvement on the second quarter’s subdued performance.”

Growth divide reaches jobs, trade and working capital

Labour markets exposed the divide across the six surveys most clearly. US recruitment was the strongest in more than four years, while India added jobs solidly and Japan recorded a seven-month high. Eurozone hiring was muted, the UK remained in a two-year job-loss streak, and Australia cut employment as orders weakened.

Export orders told a similarly uneven story. Eurozone export business rose for a second month after its prolonged contraction, while Japanese manufacturers sustained the joint-fastest growth in overseas orders for eight-and-a-half years. India’s overseas orders still increased but slowed sharply, while the US goods sector, UK private economy and Australian manufacturers reported declining foreign demand.

Working capital demands may consequently diverge as much as sales. India’s inventory build is tying up cash, while rising backlogs in the US, eurozone and Japan leave more work waiting to be completed. Longer lead times can force companies to purchase earlier, while higher energy and transport bills increase the liquidity needed to keep operations moving.

The ability to pass those costs on is equally uneven. Capacity constraints and booming US demand give companies more scope to pass on costs, whereas weak UK order books and Australia’s manufacturing contraction make that task harder. Japanese exporters have external demand behind them, but domestic softness and near-record charges create a more complicated customer picture.

September’s releases therefore resist a single global reading. The US is expanding at a rate rarely seen outside the post-lockdown reopening, India has regained manufacturing momentum, and the eurozone’s recovery is becoming broader. Japan remains resilient but slower, while the UK and Australia face a less comfortable combination of weak demand and renewed price pressure.

Treasurers will need cash forecasts and funding plans that reflect those regional differences. Energy is the common shock, but it is landing on very different operating conditions. US and eurozone businesses enter the fourth quarter with fuller order books and greater pricing power, while UK and Australian companies face higher costs against much softer demand.