US manufacturing industry contracts for first time since mid-2020

By Ovunc Kutlu

ISTANBUL (AA) - The US manufacturing sector contracted in November for the first time since mid-2020, according to a report released Thursday.

After 29 consecutive months of growth, the ISM manufacturing purchasing managers' index (PMI) declined 1.2 points to 49% in November, down from 50.2% in October.

The latest figure is the lowest since May 2020 when it stood at 43.5%, the Institute for Supply Management (ISM) said.

The market expectation for the index, based on replies from purchasing and supply executives in more than 400 industrial firms, was to come in at 49.8% in November.

While a reading above 50 indicates growth, below that shows contraction.

"The US manufacturing sector dipped into contraction, with the manufacturing PMI at its lowest level since the coronavirus pandemic recovery began," said Timothy Fiore, chair of the ISM Manufacturing Business Survey Committee.

The prices index was 43%, down 3.6 points compared to the October figure of 46.6%, also the lowest reading since May 2020.

The employment index also returned to contraction territory with 48.4%, down 1.6 points from 50% in October.

"Weakness in European economies and China’s economic sluggishness, as well as the strong dollar, continued to constrain new export order activity and negatively impact new order rates," Fiore said.