U.S. Factory Gauge Sinks to 10-Year Low as Employment Wobbles
Tuesday, 1 October 2019 21:13 WIB | ECONOMY |Ekonomi ASPabrik,
A measure of U.S. manufacturing unexpectedly fell deeper into contraction, posting the weakest reading since the end of the last recession as a global slowdown and the U.S.-China trade war increasingly weigh on the sector.
The Institute for Supply Management™s factory index slipped to 47.8 in September, the lowest since June 2009, according to data Tuesday. The figure missed all estimates in a Bloomberg survey that had called for an increase from August™s 49.1.
As the group™s production gauge slipped to a 10-year low, the employmentmeasure dropped to the lowest since January 2016. That™s a worrying sign before a jobs report Friday that™s forecast to show private payroll growth remains subdued.
The second straight reading below 50, the line separating expansion and contraction, extends the drop from a 14-year high just over a year earlier and may add to calls for the Federal Reserve to cut interest rates further. Slowing global growth has damped demand for manufactured goods at home and abroad while trade policy uncertainty has disturbed supply chains and put hiring plans on hold.
ISM™s measure of new orders, considered a leading indicator of downturns, edged up slightly to 47.3 from an August reading that matched the weakest of this expansion. The production index declined to 47.3, while the inventoriesgauge fell to 46.9, the lowest since late 2016.
ISM™s trade gauges showed American producers are struggling with headwinds from abroad as well as the effects of a resurgent dollar. The measure of export orders, a proxy for overseas demand, fell to 41, the lowest level since March 2009, while the imports index remained in contraction.
Source : Bloomberg