Increasing optimism about the US economic outlook has been dented by the release of worse-than-expected manufacturing figures from the Institute for Supply Management.
The ISM’s index of manufacturing activity rose from 48.5 in October to 49.2 last month, but crucially remained below the 50.0 threshold between expansion and contraction, showing a third consecutive month of decline in the sector. Economists were expecting a reading above 50.
The findings follow a string of recent upbeat reports on consumer spending and confidence.
Particularly concerning is a drop in the component measuring new orders, which gave a sub-50 reading for the first time since August. The employment barometer also dropped, hitting its lowest level since January.
However, the head of the index Norbert Ore found a silver lining, declaring: “We're in a much better position to go upward than further down.”
Data sourced from: Financial Times; additional content by WARC staff