ISM: Manufacturing growth slowed again in June

A reading higher than 50% indicates the manufacturing economy is growing, while a reading below that shows contraction.

Still, the overall economy continued to expand for the 62nd month since last contracting in April 2020, ISM said. (A Manufacturing PMI higher than 42.3%, over a period of time, usually indicates an expansion of the overall economy.)

“In June, US manufacturing activity slowed its rate of contraction,” ISM Chair Timothy R. Fiore said in a statement on Tuesday.

Demand and output indicators were mixed in June, Fiore added, noting that the “mixed indicators in output suggest companies still being cautious in their hiring even with an increase in production.”

The New Orders Index remained in “contraction territory and edging lower,” registering 46.4% in June vs. 47.6% a month earlier, according to ISM. Fiore also noted that New Export Orders slowed their rate of contraction (46.3% vs. 40.1%).

In June, primary metals was among the nine manufacturing industries that reported growth, while fabricated metal products was among the six manufacturing industries reporting contraction.

Executive comments

A fabricated metals executive highlighted the growing concern and impact of tariffs on domestic manufacturing: “Business has notably slowed in last four to six weeks. Customers do not want to make commitments in the wake of massive tariff uncertainty.”