United States: Manufacturing PMI drops less than markets feared
September 1, 2011
In August, the ISM manufacturing index (PMI) declined 0.3 percentage points over the previous month to 50.6%. Although the figure represented a drop over the previous month and the lowest level since July 2009, the modest contraction surprised the market on the upside, as market analysts had expected a steeper decline to 48.5%. Consequently, the index remains above the 50% threshold ?indicating expansion in the manufacturing sector for the 25th consecutive month, although at a slightly slower rate.? The deterioration was mainly driven by a drop in the production sub-index, which fell 3.7 percentage points to 48.6%, below the 50% threshold after 26 months of consecutive expansion. In addition, both the employment and exports sub-indexes moderated, albeit remaining above 50%.