US manufacturing activity weakened further in December, with the ISM PMI slipping from 48.2 to 47.9, undershooting expectations of 48.3.
Beneath the headline, details were mixed. Production edged down from 51.4 to 51.0, remaining marginally in expansion, while new orders improved modestly from 47.4 to 47.7. Employment also ticked higher to 44.9 from 44.0, though it stayed deeply contractionary. Prices were unchanged at 58.5.
ISM noted that 85% of manufacturing GDP contracted in December, up sharply from 58% in November, with the share in strong contraction rising to 43%. Even so, the historical relationship between the PMI and the broader economy suggests the December reading is still consistent with 1.6% annualized real GDP growth.
