United States: Manufacturing PMI tumbles to lowest level since in two years
August 1, 2011
In July, the ISM manufacturing index (PMI) plunged to 50.9% from 55.3% in June, which represents the lowest level since August 2009. The figure surprised the market on the downside, as analysts expected a slower decline to 54.3%, adding to concerns regarding the U.S. recovery. That said, the reading remains above the 50% threshold, indicating that the manufacturing sector has expanded uninterrupted over the previous 24 months. The deterioration over June was broad-based, as most sub-categories falling over the previous month with the exception of exports and imports. In particular, the index for new orders dropped by 2.4 percentage points to 49.2%, which indicates a contraction for the first time since June 2009. In addition, the ISM stated that ?several comments suggest a slowdown in domestic demand in the short term, while export orders continue to remain strong.?