U.S. Manufacturing Activity Posts First Contraction Since June 2020 -- S&P Global
01 Dezembro 2022 - 12:33PM
Dow Jones News
By Xavier Fontdegloria
Factory activity in the U.S. contracted in November for the
first time since the onset of the Covid-19 pandemic in 2020 due to
weak demand for goods, data from a purchasing managers survey
showed Thursday.
The S&P Global U.S. manufacturing PMI fell to 47.7 in
November from 50.4 in October, its lowest reading since June 2020
and broadly in line with the preliminary mid-month reading of 47.6.
Economists polled by The Wall Street Journal expected the index to
be unchanged from the flash estimate.
The index suggests factory activity swung to contraction in
November as the index came in below the 50.0 threshold that
separates expansion from contraction.
"A combination of the rising cost of living, higher interest
rates and growing recession fears have led to slumping demand for
goods in both the home-market and abroad," said Chris Williamson,
chief business economist at S&P Global.
Goods producers reported in November a decline in output and a
faster drop in new orders, while employment growth slowed as
backlogs of work declined sharply, the report said.
"Companies are ... cutting production at a rate not seen since
the global financial crisis, if the initial pandemic lockdowns are
excluded," Mr. Williamson said. Inventories in factories remain
high, suggesting further production cuts are likely to bring stocks
down to more manageable levels, he said.
S&P Global data showed vendor performance improved in
November for the first time in three years, signaling that supply
chains are normalizing as demand weakens.
Lower activity also led to diminishing inflation pressures,
according to the survey. The rate of input price inflation eased
for the sixth successive month to the slowest since November 2020,
while growth in output charges also moderated.
"While supply-chain worries persist ... companies' concerns are
increasingly moving away from the supply side to focusing on the
darkening outlook for demand, meaning the business mood remains
among the gloomiest seen over the past decade," Mr. Williamson
said.
Write to Xavier Fontdegloria at xavier.fontdegloria@wsj.com
(END) Dow Jones Newswires
December 01, 2022 10:18 ET (15:18 GMT)
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