Markit U.S. Manufacturing PMI: Weakest Upturn in Business Conditions
January 4, 2016 | MarkitEstimated reading time: 1 minute
Key points:
- Manufacturing PMI falls to 51.2, its lowest level since October 2012
- Slower rates of output and new business growth
- Input costs decline again in December Markit U.S. Manufacturing PMI (seasonally adjusted)
Summary
U.S. manufacturers ended the year by recording the weakest improvement in overall business conditions since October 2012. This was highlighted by a fall in the final seasonally adjusted Markit U.S. Manufacturing Purchasing Managers’ Index (PMI) to 51.2, down from 52.8 in November. Although still above the neutral 50.0 threshold, the latest reading was much weaker than the survey average (54.2) and pointed to only a marginal upturn in operating conditions.
A near-stagnation in new business volumes was the main factor weighing on the headline index in December. Measured overall, new order levels expanded only fractionally and at the weakest pace since September 2009. Anecdotal evidence cited softer underlying demand conditions, intense competition for new work and subdued business confidence among clients. Export sales were also close to stagnation in December, with manufacturers noting that the strong dollar continued to act as a drag on demand from abroad.
Manufacturing production growth moderated in response to weaker than expected new business intakes during December. The latest expansion of output levels was the least marked since October 2013. At the same time, capacity pressures eased in December, with backlogs of work decreasing at the fastest pace since September 2009. Nonetheless, payroll numbers rose at a solid rate that was slightly faster than seen during the previous month. This marked two-and-a-half years of sustained job creation across the manufacturing sector, and the pace of expansion was close to the average seen over this period. December data indicated a softer increase in purchasing activity across the manufacturing sector. Higher levels of input buying have been recorded in each month since November 2013, but the latest rise was the weakest over this period. Survey respondents noted that slower new business growth had contributed to more cautious input buying and efforts to streamline stocks. Reflecting this, preproduction inventories decreased for the first time in a year-and-a-half during December.
Input prices continued to fall during the latest survey period, with the rate of decline accelerating slightly since November. Manufacturers commented on falling costs for a range of raw materials, particularly steel. However, factory gate charges rose for the third month running. Although only modest, the rate of output charge inflation picked up to its fastest since August.
Suggested Items
GlobalFoundries Commits to Achieving Net Zero Emissions and Carbon-Neutral Power by 2050
04/23/2024 | GlobalFoundriesGlobalFoundries (GF) is furthering its commitment to sustainable operations and fighting climate change with the announcement of two new long-term goals to achieve net-zero greenhouse gas (GHG) emissions and 100% carbon-neutral power by 2050.
ROHM Group Company SiCrystal and STMicroelectronics Expand Silicon Carbide Wafer Supply Agreement
04/23/2024 | ROHMROHM and STMicroelectronics, a global semiconductor leader serving customers across the spectrum of electronics applications, announced today the expansion of the existing multi-year, long-term 150mm silicon carbide (SiC) substrate wafers supply agreement with SiCrystal, a ROHM group company.
IDTechEx Report Unveils 3D Electronics Status and Opportunities
04/22/2024 | PRNewswire3D electronics is an emerging manufacturing approach that enables electronics to be integrated within or onto the surface of objects. 3D electronic manufacturing techniques empower new features, including mass customizability, greater integration, and improved sustainability in the electronics industry.
Altus Group Helps BitBox Unlock Productivity and Efficiency Gains with New Reflow Oven
04/22/2024 | Altus GroupAltus Group, a leading provider of capital equipment, has recently assisted BitBox, a UK-based electronics design, engineering and manufacturing company in upgrading its operations with the implementation of a new reflow oven from Heller Industries.
Growth Potential: Electronics Manufacturing Driving Massive Surge in Manufacturing Investment
04/22/2024 | Shawn DuBravac, IPCIn the early months of the pandemic, investment in manufacturing infrastructure, such as plants and production facilities, declined sharply. Real investment dropped over 11%, before finally recovering to pre-pandemic levels in the first half of 2022. Over the past two years, however, several factors have combined to drive manufacturing investment to record levels.