According to the Institute for Supply Management’s PMI report, “In May, U.S. manufacturing activity slipped further into contraction…Demand indicators were mixed, with the New Orders and Backlog of Orders indexes contracting at slower rates, while the Customers’ Inventories and New Export Orders indexes contracted more strongly…the Production Index increased from an alarmingly low reading the previous month, but factory output continued to contract in May, indicating that panelists’ companies are still revising production plans downward amid economic uncertainty…as head-count reductions continued…The Inventories Index, as expected, entered contraction territory after expanding as companies completed pull-forward activity ahead of tariffs, while… the Imports Index contracted significantly, down 7.2 percentage points.” The overall PMI was 48.5 for May, down 0.2 percentage points from April (a reading below 50.0 is consistent with contraction).
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