- Prior was 46.3
- Despite a sharp fall in backlogs of work as new orders dropped, companies expanded employment at a faster rate amid greater confidence in the outlook for output.
- New export orders fell for the fourteenth month running
There was no change from the preliminary reading. The ISM number at the top of the hour is expected at 46.8 from 46.0 previously.
Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, said:
“Manufacturing continues to act as a drag on the US economy, the recent spell of malaise persisting at the start of the third quarter. However, producers are clearly shrugging off recession fears and planning for better times ahead.
“The sector continued to suffer from lower demand, as a post-pandemic shift in spending from goods to services, and an ongoing trend of cost-focused inventory reduction, led to a further drop in orders. The overall rate of order book decline nevertheless moderated during the month, helped by a slower decline in exports, to help stabilize production.
“There were several other encouraging bright spots in the survey, most notably including a marked improvement in business expectations for output in the year ahead. Firms are therefore anticipating the current soft patch to soon pass, and importantly are hiring more staff as a result.
“There was also good news on the inflation front. The combination of weak demand and improved supply led to a further “buyers’ market” for many goods. Prices charged for goods consequently barely rose for a third straight month, which should help subdue consumer price inflation in the near term.
I have been looking for green shoots in manufacturing and there are more signs here.