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2025-08-01 22:02:33
Has the pain spread? Why has the US manufacturing industry been shrinking for consecutive months? ⑴ The US Manufacturing Purchasing Managers' Index (PMI) for July was 48%, down 1 percentage point from 49% in June. ⑵ This marks the fifth consecutive month of contraction in US manufacturing activity. ⑶ Demand remains weak, with the new orders index contracting for the sixth consecutive month, while the production index bucked the trend and rose to 51.4%. ⑷ The employment index fell further to 43.4%, indicating that companies are still widely reducing their workforces. ⑸ Although the price index remains in expansionary territory, the growth rate has slowed, while supplier delivery speeds have accelerated, reflecting demand-side weakness. ⑹ The survey report shows that surveyed companies generally believe that Trump's tariff rhetoric has created significant uncertainty and has incurred unexpected costs. ⑺ Companies are struggling to find alternative suppliers, but high interest rates and trade policy uncertainty are slowing investment in new projects. ⑻ In July, 79% of sectors in the manufacturing GDP contracted, significantly higher than the 46% in June. ⑼ The report points out that this trend indicates that overall weakness in the US manufacturing industry is deepening.
