The ISM Manufacturing PMI decreased to 59.5 in July, the weakest in 6 months, compared to 60.6 in June and below analysts' estimates of 60.9. Today's report pointed to the second consecutive month of slowing factory growth as new orders (64.9 vs 66 in June), production (58.4 vs 60.8) and supplier deliveries (72.5 vs 75.1) increased less while inventories contracted (48.9 vs 51.1). On the other hand, employment rebounded (52.9 vs 49.9) however panelists continued to note significant difficulties in attracting and retaining labor at their companies' and suppliers' facilities, although there were signs of improvement. Price pressures eased (85.7 vs 92.1).
Despite the fact that recent data from the US economy have been rather weak, Markit's final July Manufacturing PMI jumped to the record high (63.4 vs 63.1 flash and 62.1 in June) while ISM's Manufacturing data fell from 60.6 to 59.5 while analysts expected an increase to 60.9. Source: Bloomberg via ZeroHedge
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Create account Try a demo Download mobile app Download mobile appBusiness Survey Committee panelists reported that their companies and suppliers continue to struggle to meet increasing demand levels. As we enter the third quarter, all segments of the manufacturing economy are impacted by near record-long raw-material lead times, continued shortages of critical basic materials, rising commodities prices and difficulties in transporting products. Worker absenteeism, short-term shutdowns due to parts shortages and difficulties in filling open positions continue to be issues limiting manufacturing-growth potential, said Timothy Fiore, Chair of the ISM.
Today's data present a mixed picture. From one side employment is picking however supply chain disruptions, which are also a sign of increasing demand, limit growth potential.
