Economic activity in US manufacturing sector contracts in April: ISM

The manufacturing purchasing managers’ index (PMI) registered 49.2 per cent in April, down by 1.1 per centage points from the 50.3 per cent recorded in March, the latest Manufacturing ISM Report on Business says.

Thirty-four per cent of manufacturing gross domestic product (GDP) contracted in April, up from 30 per cent in March.

Textile mills was among the nine manufacturing industries that reported growth in April. Furniture and related products was among the seven industries that reported contraction.

The overall economy continued in expansion for the 48th month after a month of contraction in April 2020.

The new orders index moved back into contraction territory in April after a month of expansion, registering 49.1 per cent, 2.3 percentage points lower than the 51.4 per cent recorded in March.

The April reading of the production index (51.3 per cent) is 3.3 percentage points lower than March's figure of 54.6 per cent.

The prices index registered 60.9 per cent, up by 5.1 percentage points compared to the reading of 55.8 per cent in March.

The backlog of orders index registered 45.4 per cent, down by 0.9 percentage point compared to the 46.3 per cent recorded in March.

The employment index registered 48.6 per cent, up by 1.2 percentage points from March's figure of 47.4 per cent.

The supplier deliveries index figure of 48.9 per cent is 1 percentage point lower than the 49.9 per cent recorded in March. The inventories index registered 48.2 per cent, the same reading as in March.

The new export orders index reading of 48.7 per cent is 2.9 percentage points lower than the 51.6 per cent registered in March.

The imports index continued in expansion territory, registering 51.9 per cent, 1.1 percentage points lower than the 53 per cent reported in March and February. In the last three months, this index has been at its highest levels since July 2022, when it was 54.4 per cent.

“Although demand improvement slowed, output remains positive and inputs stayed accommodative….Output (measured by the production and employment indices) moderated compared to March, with a combined 2.1-percentage point downward impact on the manufacturing PMI calculation….Inputs—defined as supplier deliveries, inventories, prices and imports—continued to accommodate future demand growth,” said Timothy R Fiore, chair of the ISM manufacturing business survey committee.

"Demand remains at the early stages of recovery, with continuing signs of improving conditions. Production execution continued to expand in March, but at a slower rate of growth than in prior months. Suppliers continue to have capacity but work to improve lead times, due to their raw material supply chain disruptions,” he added in a release.

Fibre2Fashion News Desk (DS)