Latest news with #PurchasingManagersIndex
USA Today
2 days ago
- Business
- USA Today
How Trump tariffs make American manufacturers grate, not greater
How Trump tariffs make American manufacturers grate, not greater One of the key promises behind President Donald Trump's tariff strategy was to revive U.S. manufacturing. But the policies intended to lay that foundation are currently having the opposite effect. During the past three months, as President Donald Trump and his administration have worked to finalize tariff rates across dozens of countries and product categories, U.S. manufacturing has contracted—according to the Institute for Supply Management's May report. '57% of the manufacturing sector's GDP contracted in May," Susan Spence, chair of the Institute for Supply Management's Manufacturing Business Survey Committee, said during a press briefing Monday. "That's up from 41% in April. The contraction is deepening.' Exclusive: Trump pushes countries for best offers as tariff deadline looms Manufacturing continued to contract in May The institute's Purchasing Managers Index fell to 48.5% in May, 0.2 percentage points lower than April's 48.7%. A number consistently below 50% means manufacturing is contracting. \"The headwinds from tariff increases are starting to show up in economic data," wrote Bill Adams, chief economist for Comerica. "The ISM Manufacturing PMI reports that tariffs are a drag on business, as is the uncertainty about where tariffs will settle over the longer term." As part of its monthly reports, the Institute for Supply Management includes anonymous quote from its survey panel on current business conditions. In the latest release, every comment touched on tariffs. One manufacturing manager expressed cautious optimism over the easing of tariffs in May—but remained concerned about the ongoing uncertainty. 'Tariff whiplash continues while the easing of tariff rates between the U.S. and China in May was welcome news, the question is what happens in 90 days. We are doing extensive work to make contingency plans, which is hugely distracting from strategic work." What manufacturing managers said about tariffs in May Below, managers from various industries reported how tariffs affected their organization in May, according to those quoted in the Institute for Supply Management's release: Trump administration asks for countries' best offers 'Production is frozen," Spence said Monday. "Growth can't resume until we get clarity on tariff policy.' Could some of the uncertainty surrounding tariffs be resolved soon? An exclusive report from Reuters on Monday said the Trump administration has set a deadline of June 4 for countries to give the United States their best and final tariff offers. The deadline would give the administration five weeks before its July 8 deadline, or 90-day pause, that they set on April 9. US economy is still growing While Monday's report wasn't upbeat for manufacturers, it did show that the broader economy is still growing. If the manufacturing index remains over 42.3%, it generally indicates that the economy is still expanding. "Goods-producing sectors of the economy will likely contract in 2025," Adams wrote. "However, service-providing industries, which account for most economic activity and employment, are likely to keep growing and help the economy avoid a recession."
Business Times
4 days ago
- Business
- Business Times
Trade war hits Asia factories as exports, production slide
[HONG KONG] Manufacturing activity across several Asian nations weakened in May as US tariffs and trade uncertainty eroded demand. In Vietnam, new export orders contracted for a seventh straight month and input costs fell for the first time in about two years, according to S&P Global data published on Monday (Jun 2). In Taiwan, output and new export sales all fell for a second month, Indonesia saw the steepest drop in new orders since August 2021, and South Korean manufacturers recorded the deepest decline in output in nearly three years. Vietnam, Indonesia, Taiwan, Japan and South Korea all recorded a contraction in overall activity, with the Purchasing Managers Index remaining below the 50-no change mark. Activity in the Philippines, meanwhile, grew at a slower pace. The figures reflect the ongoing uncertainty amid US President Donald Trump's tariff campaign and the start-stop nature of US trade policies. Trump ratcheted up tensions late last week, vowing to double steel and aluminium tariffs and accusing China of violating an agreement to lower levies. Beijing retaliated on Monday by slamming Trump's claim and lodging accusations that the US had introduced new discriminatory restrictions. Bank of Korea governor Rhee Chang-yong said the outcome of trade negotiations between the US and China will have an impact for all of Asia's economies, highlighting their significance beyond the bilateral level. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'When we actually measure the impact of US tariffs on us, the indirect impact through China is very important because we are very much connected with them through supply chains,' the governor said on Monday. Trump's 'Liberation Day' tariffs remain in a grey zone as a US court rejected them, followed by a successful appeal from the administration. If they proceed, US levies would rise to a century-high next month. Manufacturers in Asia cited this whiplash as dampening demand now and in the future. 'Weaker demand conditions and increased client hesitancy to commit to new work amid US tariffs' hit sales in Taiwan, according to S&P Global, prompting a cut to employment and purchases. Businesses across the region cited lower demand rippling through the supply chain and on the factory floor. The May data follow a month when exports and freight activity surged across the region as US firms frontloaded shipments during Trump's 90-day tariff pause. South Korea's exports contracted in May as shipments to the US declined by 8.1 per cent, according to data released on Sunday by the customs office. Looking forward, there are some initial indicators that Trump's tariff pause to allow for negotiations and the tentative deals with the UK and China may help improve activity. In Vietnam, a major producer of clothing, shoes and smartphone parts, companies said an improvement in production and a more optimistic outlook was aided by tariff stability. BLOOMBERG
BusinessToday
23-05-2025
- Business
- BusinessToday
Ringgit Strengthens Amid Softer US Dollar And Mixed US Economic Data
The ringgit opened stronger against the US dollar on Friday, buoyed by a weaker US Dollar Index (DXY) and a mixed bag of US economic indicators, according to analysts. At 8 am, the local unit rose to 4.2575/2860 against the greenback, improving from Thursday's close of 4.2705/2765. It also made gains across the board against both major and regional currencies. Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the DXY stayed below the 100-point mark, reflecting tempered market sentiment on the dollar. He noted that although the US initial jobless claims were slightly lower than expected at 227,000 (versus a consensus forecast of 230,000), the number of continuing claims rose to 1.90 million from 1.87 million. 'This suggests that the labour market is still resilient,' he told local media. Meanwhile, the US manufacturing sector posted positive momentum, with the Purchasing Managers Index (PMI) climbing to 52.3 points in May from 50.2 in April. 'A significant rise in new orders was the main driver,' he added. However, other components such as employment were muted, and businesses were increasing inventories in anticipation of higher tariffs and prices. Mohd Afzanizam also pointed to political developments in the US, highlighting the passage of the One Big Beautiful Bill Act by the House of Representatives. The bill extends the 2017 tax cuts, introduces new deductions for tips, and raises the cap on state and local taxes. 'Budget deficits are likely to balloon from the current 6.1% of gross domestic product (GDP). This will impact the government's debt burden, which already stands at 100% of GDP,' he said. He added that a weaker US dollar in this context bodes well for emerging market currencies, including the ringgit. At the same time, the ringgit recorded broad-based gains. It appreciated to 2.9591/9791 against the Japanese yen (from 2.9768/9812), 5.7131/7514 versus the British pound (from 5.7212/7292), and 4.8029/8350 against the euro (from 4.8218/8286). Regionally, it strengthened to 3.2943/3166 against the Singapore dollar (from 3.3061/3110), and to 12.9498/13.0484 against the Thai baht (from 13.0000/0254). The local note also rose to 260.7/262.6 against the Indonesian rupiah (from 261.5/262.0), and 7.65/7.71 vis-a-vis the Philippine peso (from 7.68/7.69). Related
Business Recorder
19-05-2025
- Business
- Business Recorder
LSM ticks up
The State Bank's Purchasing Managers Index (PMI) surged to a 30-month high in April 2025, signaling a noticeable uptick in manufacturing sentiment. Capacity utilization in the sector improved modestly, up by 1 percentage point year-on-year. Meanwhile, Large-Scale Manufacturing (LSM) posted a 1.78 percent year-on-year increase in March 2025 — the first positive reading since October 2024. Of the 22 major sectors tracked by the Pakistan Bureau of Statistics (PBS), 10 registered cumulative growth during 9MFY25, pushing the diffusion index into positive territory for the first time in six months. But that is about where the optimism fades. A closer look at the broader LSM picture reveals a grim reality — one that is hard to ignore. Take March 2017, for instance: its LSM index was a full six percentage points higher than that of March 2025. And this is not an outlier. The index readings for March in 2018, 2019, 2021, and 2022 all surpass the latest figures by a significant margin. While recent months have already marked five- and six-year lows, the March 2025 reading pushes the benchmark back even further — effectively wiping out eight years of progress. Cumulative LSM growth has remained in negative territory for eight consecutive months, with the 9MFY25 index now at its lowest level since FY21. While the diffusion index has shown some improvement, the gains remain shallow: only three of the 12 growing sectors posted double-digit growth. In contrast, seven out of the 10 sectors in decline suffered double-digit contractions. Admittedly, low-weight categories like furniture and electrical equipment dragged the overall index down, offsetting gains from more resilient segments such as readymade garments and automobiles. Yet even among heavyweight industries — cement, steel, and chemicals — the performance remains lackluster, offering little cause for optimism. Half of the 22 LSM sub-sectors continue to operate below the index levels recorded at the start of the current base year — nearly a decade ago. This is not a cyclical dip; it is structural regression. Some industries may never claw their way back. The scale of the decline is sobering on a seasonally adjusted 12-month rolling basis, cement output is at an 8-year low, steel at a 5-year low, chemicals at a 4-year low — and a host of smaller industries are hovering near decade-long troughs. The erosion runs deep. There are, admittedly, some bright spots. The automobile and allied industries continue to recover, helped along by a favorable base effect. Pharmaceuticals and textiles have also shown signs of life. But even these relative gains come with caveats. Most of these sectors remain well below the peaks they reached at various points over the past 7–8 years. The textile sector, for instance, has now clocked 30 consecutive months with its LSM index value stuck below the 100 mark — a telling sign of prolonged stagnation. On the glass-half-full side, industrial activity will not remain subdued indefinitely. A few sectors have begun to show early signs of recovery, and the recent — and anticipated — relief in industrial electricity tariffs, combined with a sharp drop in interest rates, could provide some momentum. That said, returning to the highs of 2022 will not be easy. The erosion in purchasing power over the past two years is too steep to be reversed by a single year of low inflation alone. A sustained recovery will take time — and more than just monetary easing. Copyright Business Recorder, 2025
India.com
13-05-2025
- Business
- India.com
China...US...France remain behind India as New Delhi races ahead in....
PM Modi- File image In a great update for India amid the decline in India-Pakistan tensions, India has reached the top of the global charts in both manufacturing and service activities. When the tensions between India and Pakistan were on a rise and the global economy was expected to slow down as a result of tariff war started by US President Donald Trump, the data of Purchasing Managers Index (PMI) released by JP Morgan has indicated a massive positive for India. Here are all the details you need to know. India ahead of China and Pakistan India's services sector continued to grow in April, with the Services Purchasing Managers' Index (PMI) rising slightly to 58.7 from 58.5 in March, an HSBC report said on Tuesday. For those unversed, a PMI reading above 50 indicates expansion, while anything below signals contraction. The increase points to steady improvement in the services sector, supported by a sharp rise in new business orders, according to HSBC India Composite PMI Output Index. For a point of comparison, China's manufacturing PMI tracked by the National Bureau of Statistics (NBS) was at 49 in April and according to ISM the US Manufacturing PMI was only 48.7 in April 2025, while the Service PMI. On the other hand, France only has a manufacturing PMI at 48.7. Strong market demand Many companies reported strong market demand and successful marketing strategies, while others said they were able to handle more work due to better efficiency. The finance and insurance sector led the growth, showing the highest gains in both output and new orders. Export demand also picked up significantly. After a temporary slowdown in March, new export orders rose at their fastest pace since July 2024, driven by increased interest from markets in Asia, Europe, West Asia, and the United States. This contributed to improved margins for service providers, as easing cost pressures allowed companies to raise prices at a quicker pace. Manufacturing also showed improvement, with the HSBC India Manufacturing PMI inching up to 58.2 from 58.1 in March, hitting a 10-month high. This follows a 14-month low in February. The rebound in April was fuelled by higher production, more hiring, and increased purchasing of inputs. (With inputs from agencies)
