A report from the Institute for Supply Management (ISM) revealed on Friday
the U.S. manufacturing sector’s activity expanded in June, albeit at a
weaker pace than in the previous month.
The ISM's index of manufacturing activity - the manufacturing PMI - checked
in at 53.0 percent in June, down 3.1 percentage points from an unrevised May
reading of 56.1 percent. The June
reading pointed to the growth in the U.S. manufacturing sector for the 25th
straight month, which, however, was the slowest one since June 2020 (52.4
percent).
Economists had forecast the indicator to fall to 54.9 percent.
According to the report, the New Orders Index plunged 5.9 percentage
points to 49.2 percent, turning into contraction territory after growing for 24
consecutive months, while the Employment Index dropped 2.3 percentage points to
47.3 percent, slipping further into contraction territory. In addition, the
Supplier Deliveries Index tumbled 8.4 percentage points to 57.3 percent, and the
Backlog of Orders Index decreased 5.5 percentage points to 53.2 percent. In the
meantime, the Production Index rose 0.6 percentage point to 54.9 percent last
month, and the Inventories Index edged up 0.1 percentage point to 56.0 percent.
On the price front, the Prices Index fell 3.7
percentage points to 78.5 percent, indicating raw materials prices rose for the
25th straight month in June, but at a softer pace compared to the previous
month.