Posted on 08/21/2015 10:32:20 AM PDT by BenLurkin
The U.S. manufacturing sector is once again under pressure as it continues to hover just above contraction level, according to the latest flash Purchasing Managers Index data.
Friday, private research firm Markit said its August PMI estimate fell to a level of 52.9, compared to July’s final reading of 53.8. According to consensus reports, economists were expecting to see a reading at 53.9.
According to the report, this is the lowest manufacturing reading since October 2013.
““With the headline PMI swiftly losing ground after a modest rebound during July, the latest figure now points to the weakest overall pace of manufacturing growth for almost two years,” said Tim Moore, senior economist at Markit, said in the report.
A reading above 50.0 signals an improvement in business conditions, while readings below 50.0 signal deterioration.
Markit added that rise in production volume was the weakest since weather related slowdowns last seen January 2014. According to survey participants, the strong U.S. dollar continues to hurt the manufacturing sector as it makes U.S. exports more expensive.
“According to survey respondents, the strong dollar continued to put pressure on export sales and competitiveness, while heightened global economic uncertainty appeared to have dampened client spending both at home and abroad. Alongside this, manufacturers of investment goods widely cited growth headwinds from the slump in capital spending across the energy sector,” said Moore.
On Wednesday, the minutes of the July Federal Open Market Committee (FOMC) meeting, showed that some committee members were concerned about the recent strength of the U.S. dollar.
“Some participants also discussed the risk that a possible divergence in interest rates in the United States and abroad might lead to further appreciation of the dollar, extending the downward pressure on commodity prices and the weakness in net exports,” the minutes said.
While Market’s survey is the first glimpse of state of the national manufacturing sector, the regional picture is slightly more mixed. Earlier in the week the New York Federal Reserve said that its manufacturing survey fell to its lowest level since 2009, falling to a reading of -14.9 down from July’s reading of 3.9.
However, Thursday, the Philadelphia Federal Reserve said its manufacturing survey rose to 8.3, up from July’s reading of 5.7.
Obamanomics!
Scrimp and save and pay off any debts you have. We see widespread contraction of our economy that has depended heavily on the oil and gas industries to keep afloat. Manufacturing is hurting because of the ripple effect.
Obama is more interested in boosting Iran’s oil business than ours and China’s economy is faltering, so our energy businesses are going to be hurting for at least another year. Can our Federal Reserve push interest rates to less than zero so businesses can borrow and stay solvent? It’s doubtful.
of course! &^)
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.