U.S. Manufacturing Index Inches Up In Line With Estimates In August
(RTTNews) - The Institute for Supply Management released a report on Tuesday showing a slight increase by its reading on U.S. manufacturing activity in the month of August, although the index still indicated the sixth consecutive month of contraction.
While the ISM said its manufacturing PMI inched up to 48.7 in August after falling to a nine-month low of 48.0 in July, a reading below 50 still indicates contraction. The uptick matched economist estimates.
The modest rebound by the headline index partly reflected a turnaround by new orders, as the new orders index jumped to 51.4 in August from 47.1 in July.
The ISM also said the employment index crept up to 43.8 in August from 43.4 in July but posted its seventh consecutive month of contraction.
On the other hand, the report showed a downturn by production, with the production index slumping to 47.8 in August from 51.4 in July.
"In August, U.S. manufacturing activity contracted at a slightly slower rate, with new orders growth the biggest factor in the 0.7-percentage point gain of the Manufacturing PMI," said Susan Spence, Chair of the ISM Manufacturing Business Survey Committee.
She added, "However, since production contracted at a rate nearly equal to the expansion in new orders, the Manufacturing PMI increase was nominal."
On Thursday, the ISM is scheduled to release a separate report on service sector activity in the month of August. The services PMI is expected to creep up to 50.5 in August from 50.1 in July, with a reading above 50 indicating growth.
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