Factory activity in the US contracted in July for the ninth month, reflecting tepid demand for US goods at home and abroad.
The Institute for Supply Management’s index of factory activity rose to 46.4 last month, according to data released on Tuesday, down slightly from expectations. Readings below 50 indicate contraction.
New orders and production data improved in July, with the latter rebounding to a nine-month high. However, both remained in the contraction zone. Meanwhile, the group’s export gauge dropped to its lowest level this year as outbound shipments of US goods continued to decline.
While other parts of the economy remain strong, high interest rates – which coincide with a constant change in consumer preferences for services – are stifling the manufacturing sector. Weak demand abroad proved to add to the challenges.
Widespread weakness in the sector forced factories to cut staff. The group’s employment gauge fell to 44.4 points, the lowest level since July 2020.
2023-08-01 14:33:08
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