US Manufacturing Steady in September; Prices Paid Measure Lowest in Nine Months

• U.S. manufacturing held steady at weaker levels in September, but new orders improved, and prices paid for inputs declined to a nine-month low. The improvement coupled with falling interest rates bodes well for a rebound in activity in the coming months.
• The Institute for Supply Management (ISM) said on Tuesday that its manufacturing Purchasing Managers' Index (PMI) was unchanged at 47.2 last month. A PMI reading below 50 indicates a contraction in the manufacturing sector, which accounts for 10.3% of the economy.
• It was the sixth consecutive month that the PMI remained below the 50 threshold, but above the 42.5 level that the ISM said over time generally indicates an expansion of the overall economy. The survey has, however, exaggerated the weakness in manufacturing, with the so-called hard data, such as factory production and durable goods orders, showing the sector largely moving sideways.
• Gross domestic product data last week showed manufacturing output rising at a 2.6% annualized rate in the second quarter, an acceleration from the 0.2% pace posted in the January-March quarter. Further gains are likely after the Federal Reserve cut interest rates last month for the first time since 2020.

(Source: Reuters)