The article discusses the state of the manufacturing and construction sectors. The June ISM Manufacturing index fell by 0.9 points month-on-month to 46.0, missing the consensus for a 0.1 point rise to 47.0. The PMI has been contracting for 8 months now. The S&P Global’s US Manufacturing PMI numbers also fell to 46.3, lower from May’s reading of 48.4. Both these indices are in contractionary territory, indicating a slowdown in the manufacturing sector.
- New Orders: S&P Global reported a sharp decline in new orders, the steepest for 2023, while ISM shows a slight improvement in new orders.
- Employment: The ISM report shows a 3.3 point decline in employment, falling into contractionary territory, while the S&P Global report mentions an increase in employment.
- Inventories: Inventories fell across both reports. Firms were looking to reduce inventories.
- Prices Paid: This metric also declined across both reports, indicating a decline in the Producer Price Index (PPI) as commodity prices weaken and supply chains improve.