Manufacturing Outlook Dips becomes negative as order
The August Manufacturing Business Outlook survey revealed weak activity in several major indicators. The general activity index fell rapidly from 15.9 to -0.3, and slipped into the negative area at the new order -1.9 -their first sub -reading reading since April. Shipment also fell to 4.5, and the employment index fell to 5.9, although it still indicated to be placed on pure work.
While the average workweek improved slightly, weakening in orders reveals a soft demand in the manufacturing sector. Importantly, 74% of the surveyed firms reported changes in employment, while only 16% saw an increase. This stable position can weight the expectations of regional production and disrupt extensive industrial performances in Q3.
Price pressure mount; Firms eye competitive price increase
The price pressure remains high. Prices payments increased by 8 points to 66.8 – the highest – the highest – the prices increased to 36.1 since May 2022. The firms increased their 12 -month forward price expectations in May to 4.1% in May, suggesting that pricing power is strong despite economic headwind.
More than half of the surveyed firms estimate the cost of the growing industry within the next six months, contestants are expected to increase prices with 71.4% – and an average hopeful price changes will be physical within three months. While the expectations of compensation increase decreased from 4.0% to 3.5%, high input and output price expectations can keep inflation indicators elevated in the near period.
Market forecast: Nearby approach to slowing down labor and manufacturing signals
The combination of weakening of labor market indicators, declining manufacturing orders and constant value weakening the pressures depicts a picture of a caution. While the future hopes in the survey remained positive, the current circumstances are deteriorating. There is a near -term approach to American equity and industrial RecessionEspecially if the demand for cattle collides with sticky inflation, it complicates the path of the Federal Reserve at the rates. Traders should closely monitor up to confirmation of upcoming employment data and inflation print.
