US manufacturing activity contracts for seventh straight month
The report shows manufacturers enjoyed a respite from inflationary pressures for raw materials
[WASHINGTON] US factory activity shrank in September for a seventh consecutive month, reflecting a pullback in orders and adding to evidence manufacturing is lacking traction.
The Institute for Supply Management’s (ISM) manufacturing index edged up 0.4 point to 49.1, according to data released on Wednesday (Oct 1). Readings below 50 indicate contraction, and the measure has been stuck in a narrow range for the whole year.
The group’s orders index slid 2.5 points to 48.9, slipping back into contraction territory after expanding a month earlier for the first time since January. Factory employment shrank less in September but remained historically depressed.
Economists and policymakers will be relying more on private reports such as the ISM survey for clues on the economy in the absence of official data because of the US government shutdown.
The report also showed manufacturers enjoyed a respite from inflationary pressures for raw materials. The prices-paid measure dropped for a third straight month, the longest such stretch since 2022, to 61.9. That’s the lowest level since the start of the year, prior to the Trump administration’s implementation of tariffs.
A further easing in input-price growth may temper price pressures for consumers. Government figures last week showed prices for goods such as appliances, household supplies and recreational goods and vehicles fell in August, spurring stronger purchases. Spending on merchandise climbed 0.7 per cent.
SEE ALSO
The ISM survey also showed inventories at manufacturers shrank by the most in four months, suggesting producers were able to partially fill the pickup in August orders with existing stockpiles. Meanwhile the ISM’s production gauge increased 3.2 points to 51.
In a sign factory production will remain stable in coming months, the ISM measure of customers’ stockpiles dropped to 43.7, matching the lowest level in nearly three years. BLOOMBERG
Share with us your feedback on BT's products and services
