The ISM manufacturing index released by the United States on Thursday (1st) was steady at 52.8, the same as the previous value, higher than the market expectation of 52, mainly due to the rebound in the employment and new orders index. It is worth noting that the price index fell again by 7.5 points to 52.5 in August, the lowest since June 2020 and the fifth consecutive monthly decline, indicating that inflationary pressures are waning.
August U.S. ISM manufacturing sub-index:
- The new orders index was reported at 51.3, the previous value was 48.0
- The production index was reported at 50.4, the previous value was 53.5
- The employment index was reported at 54.2, the previous value was 49.9
- The supplier delivery index was reported at 55.1, the previous value was 55.2
- The inventory index was at 53.1, the previous value was 57.3
- The client inventory index was reported at 38.9, the previous value was 39.5
- The price index reported 52.5, the previous value was 60.0
- The index of outstanding orders reported 53.0, the previous value was 51.3
- The export order index was reported at 49.4, the previous value was 52.6
- The raw material import index was reported at 52.5, the previous value was 54.4
The U.S. ISM manufacturing index for August showed modest growth in manufacturing and a further easing of supply constraints despite spending shifting toward services and rising recession risks as interest rates rose rapidly and business confidence fell.
Looking at the details of the data, the weakening of the global economy and fears of recession have led to a decline in the prices of oil, metals and other commodities. As a result, the price index in August fell by 7.5 points to 52.5, which was lower than the previous value of 60 in July, the highest since June 2020. The new low, which has been falling for five consecutive months, indicates that inflationary pressures are waning.
The new orders index in August rose to 51.3 from the previous value of 48.0 in July, ending a two-month decline. In addition, the index of outstanding orders in August also increased to 53 from the previous value of 51.3, indicating that factories are in good condition for a period of time to come.
There are also signs of improvement in the supply chain, with the supplier delivery index at 55.1 in August, down slightly from 55.2 in July, with an index above 50 indicating a slowdown in factory deliveries.
On the employment front, the employment index jumped to a five-month high of 54.2 in August from 49.9 in July, which bodes well for August’s nonfarm payrolls report. Despite tightening central bank monetary policy, deteriorating financial conditions and public jitters about a recession, labor demand remains strong.
Overall, the steady growth in the manufacturing index is further evidence that the U.S. economy has not fallen into recession despite a contraction in U.S. gross domestic product (GDP) in the first half of this year.
Timothy Fiore, chairman of the ISM Manufacturing Business Survey Committee, said that the market is still optimistic about demand. Among the comments on manufacturing growth in various industries, positive comments accounted for 5, and cautious comments accounted for 1, but experts are on the weakening economy. express unease.