US Factory Activity Shrinks by the Most in Four Months
US factory activity shrank in November by the most in four months as orders weakened, indicating manufacturers are struggling to break free from an extended period of malaise.
The Institute for Supply Management’s manufacturing index eased 0.5 point to 48.2, according to data released Monday. The measure has been below 50, which indicates contraction, for nine straight months.
The survey suggests the nation’s manufacturing base remains bogged down by trade policy uncertainty and elevated production costs. The ISM index of prices paid for materials picked up for the first time in five months and is about 8 points higher than a year ago.
Customer demand has largely been uninspiring as well. Orders contracted in November at the fastest pace since July, while backlogs shrank by the most in seven months. The soft demand conditions help explain a steeper contraction in factory employment last month.
Meanwhile, the group’s production index rebounded in November, expanding at the fastest clip in four months. Despite the advance, output this year has been uneven.
Eleven manufacturing industries contracted in November, led by apparel, wood and paper products and textiles. Four industries, including computer and electronic products, reported growth.
The survey also showed that supplier delivery times of materials for manufacturers quickened for the first time in four months.
Producers’ and customers’ inventories continued to shrink, although at slower paces than a month earlier.
Source : Bloomberg.com
