Manufacturing contracted in June for the first time since July 2009, despite overall economy growth for the 37th consecutive month, according to the latest Manufacturing Institute for Supply Management Report on Business.
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The PMI registered 49.7 percent in June, 3.8 percentage points lower than May's reading of 53.5 percent. This indicates contraction in the manufacturing sector for the first time since July 2009, when the PMI registered 49.2 percent.
The New Orders Index dropped 12.3 percentage points to 47.8 percent, indicating contraction in new orders for the first time since April 2009, when the New Orders Index registered 46.8 percent. The Prices Index for raw materials fell to 37 percent, a decline of 10.5 percentage points from the 47.5 percent reported in May.
Of the 18 manufacturing industries, seven reported growth in June: Furniture & Related Products; Printing & Related Support Activities; Fabricated Metal Products; Miscellaneous Manufacturing; Electrical Equipment, Appliances & Components; Machinery; and Primary Metals. The nine industries reporting contraction in June are: Nonmetallic Mineral Products; Apparel, Leather & Allied Products; Paper Products; Plastics & Rubber Products; Chemical Products; Computer & Electronic Products; Petroleum & Coal Products; Food, Beverage & Tobacco Products; and Transportation Equipment.
Some ISM manufacturing survey respondents viewed the economy as showing signs of slight slowing, while some other sectors reported business as “still strong” or “getting better.”
