US ISM Manufacturing PMI declined from 47.2 to 46.5 in October, falling short of the expected 47.6 and marking its lowest level since July 2023. This contraction is the index’s 23rd in the past 24 months.
Key components showed mixed results: new orders ticked up slightly from 46.1 to 47.1, but production dropped sharply from 49.8 to 46.2. Employment remained subdued, inching up only marginally from 43.9 to 44.4, while the prices index saw a notable increase from 48.3 to 54.8, suggesting upward cost pressures.
According to ISM, “demand remains subdued,” as firms remain hesitant to invest in capital and inventory, largely due to uncertainties surrounding Fed’s monetary policy and concerns about inflation resurgence driven by fiscal policies from both major parties. October’s reading aligns with a modest 1.1% annualized growth in real GDP.
