Manufacturing economic activity contracted for a 10th straight month in August. This news comes from the recently released Manufacturing ISM Report On Business .The August Manufacturing PMI came in at 47.6%, 1.2 percentage points more than July’s 46.4%.
According to Timothy R. Fiore, CPSM, C.P.M., Chair of the Institute for Supply Management (ISM) Manufacturing Business Survey Committee, the composite index reading for August points to the fact that companies are managing outputs appropriately as order softness goes on. He mentioned that the month-over-month uptick in the index points to improvement.
The food, beverage, and tobacco industry reported growth during August. The industry also registered growth in production over the month, as well as paying decreased prices for raw materials. The industry reported higher inventories during this time as well as slower supplier deliveries.
According to one industry respondent, “Customer orders have softened. This is likely due to customers’ increased confidence in the supply chain, (which) has them reducing their inventories. Customers are also being pinched with higher interest rates. Additionally, consumers are feeling their purchasing power eroded by stubbornly high inflation, so they are purchasing less.”