United States PMI July 2016

United States

United States: U.S. manufacturing sector moderates in July

August 1, 2016

Following two consecutive increases, the ISM manufacturing index declined more than expected in July. The indicator fell from 53.2 in June to 52.6 in July and came in below market expectations of 53.1. Despite the disappointing result, the manufacturing sector grew for the fifth consecutive month as the ISM index remained above the 50-threshold that indicates an expansion where it has been since March.

The underlying details show that new orders remained virtually unchanged in July and manufacturing output increased slightly. Conversely, the rest of sub-gauges showed a broad-based deterioration in July. Backlogs of orders, employment and inventories dropped compared to the previous month, with inventories falling for the thirteenth consecutive month. Supply delivery times also slowed down considerably in July.

FocusEconomics Consensus Forecast panelists expect that industrial production will decrease 0.5% in 2016, which is down 0.3 percentage points from last month’s forecast. For 2017, panelists see industrial production expanding 2.1%.


Author:, Senior Economist

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USA PMI July 2016

Note: Composite index in the Manufacturing Report on Business (PMI). Readings above 50% indicate an expansion in the manufacturing sector while readings below 50% point to a contraction.
Source: Institute for Supply Management.


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