US manufacturing sector continued to cool down in January, ISM says
American manufacturing activity underwhelmed again at the start of the year, according to one of the most widely-followed surveys for the sector.
The Institute for Supply Management´s manufacturing sector purchasing managers´ index edged higher from a reading of 48.0 for the month of December to 48.2.
That was less than the reading of 48.4 which economists had penciled in.
On a more positive note, a sub-index of new orders increased from 48.8 to 51.5, moving past the 50.0-point threshhold which denotes growth.
If that improvement held then the headline PMI number might improve over coming months, Ian Sheperdson, the chief economist at Pantheon Macroeconomics said in a research note sent to clients.
Nonetheless, "we still have no expectations of a significant rebound in manufacturing anytime soon. The pressure from the strong dollar and the collapse oil sector capex is too great, though it should fade gradually over the course of this year," Sheperdson added.
A gauge of employment in the sector - which accounts for 9% of total payrolls - worsened, slipping from 48.0 to 45.9.
Jesse Hurwitz at Barclays was more downbeat, telling clients that: "This morning’s report is consistent with our outlook for tepid activity and employment growth in the US manufacturing sector this year.
"The continued appreciation of the trade-weighted dollar is hurting US manufacturers’ competitiveness in many foreign markets, where demand continues to deteriorate. We expect this trend to continue in the near-term."