Washington – According to the recent Manufacturing Institute for Supply Management’s (ISM) Report on Business, the manufacturing sector in the U.S. expanded in September for the 33th consecutive month but at its lowest pace in two years, a sign of tepid growth in a sector getting squeezed by a stronger dollar and weak overseas demand.
The ISM’s manufacturing purchasing index slipped to 50.2 in September from 51.1 in August, hitting the lowest level since May 2013, but still above the 50 percent that indicates the manufacturing sector is expanding. This will be the 33th consecutive month the U.S. factories show growing beside decreasing 0.9 percentage point during the last month.
“The U.S. manufacturing sector has seen a distinct loss of growth momentum in recent months […] Headwinds include the rising dollar, weak demand in global markets, a downturn in business investment and financial market jitters,” said Chris Williamson, chief economist at Markit to Fox Business.
Economists surveyed by The Wall Street Journal had expected the index to fall to 50.8 and were surprised by the report evidencing that only seven of the 18 manufacturing sectors contributing to the report saw growth in September, down from ten in August.
The ISM numbers are just one of the latest in a string of mixed reports for U.S. factories like the Federal Reserve’s measure of manufacturing output that also decreased during August and the recent Commerce Department report that showed a drop in exports of autos and consumer goods. The new orders index in the report by the ISM, often viewed as a leading indicator of activity, also decreased to 50.1 last month from 51.7 in August and the production index ranked at 51.8 from 53.6 a month ago.
The U.S. Labor Department also released a report on Thursday showing claims for U.S. unemployment benefits rose by more than expected in the week ended September 26th.
The report said initial jobless claims climbed to 277,000, an increase of 10,000 from the previous week’s unrevised level of 267,000. Economists surveyed by The Wall Street Journal think the U.S. economy added 200,000 jobs last month, up from 173,000 in August.
Source: PR Newswire