Share Market Daily Writer By Mahesh Limbani Published September 1, 2022
A measure of materials costs declined for a fifth consecutive month in August, a welcome sign inflationary pressures are abating. US manufacturing growth slowed at its slowest pace in over two years.
Factory activity fell to 52.8, its lowest level since June 2020, according to the Institute for Supply Management. A reading above 50 indicates expansion, according to a Bloomberg survey.
In the Manufacturing Business Survey, five positive growth comments were received for every cautious comment, said Timothy Fiore, chair of the Manufacturing Business Survey Committee.
Mineral products, petroleum, and transportation equipment led the growth in manufacturing for the month.
According to the figures, manufacturing has been growing moderately and supply constraints have eased a bit.
As a result of the war in Ukraine and the economic slowdown in China, this industry is doing better than its counterparts in Europe and Asia.
Prices for oil, metals and other commodities have declined due to a weaker global economy and recession concerns.
Thus, the US ISM's measure of prices paid for materials used in the production process fell 7.5 points to its lowest level since June 2020. In the previous month, the gauge fell 18.5 points.
Deliveries from suppliers have slowed since before the pandemic, according to the ISM. Stockpiles were rebuilding at a slower rate, as factory inventories fell to a four-month low of 53.1.
Meanwhile, the ISM's employment gauge rose to 54.2 in August, suggesting more manufacturers were adding jobs.