United States: Manufacturing PMI falls in August
The S&P Global United States Manufacturing Purchasing Managers’ Index (PMI) fell to 47.9 in August from 49.6 in July. As a result, the index moved further below the 50.0 no-change threshold, and signaled a faster deterioration in manufacturing-sector operating conditions compared to the previous month.
The downturn in the U.S. manufacturing sector was primarily driven by a decrease in production, the first in seven months, as firms responded to the most significant reduction in new orders since June 2023. This decline in demand led to a renewed reduction in employment and a scaling back of purchasing activity.
Inflationary pressures intensified, with the rate of input cost inflation accelerating to a 16-month high due to higher costs for shipping, labor, and rising raw material prices. This led to output prices also increasing at a faster pace. Finally, firms remained optimistic about the future, although overall business sentiment eased slightly from July.