Purchasing Managers’ Index Contracts for Fifth Consecutive Month
“The December PMI® registered 47.2 percent, a decrease of 0.9 percentage point from the November reading of 48.1 percent. This is the PMI®‘s lowest reading since June 2009, when it registered 46.3 percent,” said Timothy R. Fiore, CPSM, C.P.M., Chair of the Institute for Supply Management® (ISM®) Manufacturing Business Survey Committee.
“Global trade remains the most significant cross-industry issue, but there are signs that several industry sectors will improve as a result of the phase-one trade agreement between the U.S. and China. Among the six big industry sectors, Food, Beverage & Tobacco Products remains the strongest, while Transportation Equipment is the weakest. Overall, sentiment this month is marginally positive regarding near-term growth,” says Fiore.
WHAT RESPONDENTS ARE SAYING
- “Backlog of orders is shrinking due to new order pace continuing to fall.” (Computer & Electronic Products)
- “Due to sluggish sales, we have introduced promotions to generate increased sales.” (Chemical Products)
- “Cautiously optimistic is the rule these days. Sales are decent, but we’re wondering what 2020 will bring. Still hedging that it will be successful — but maybe not as much as this year.” (Transportation Equipment)
- “Starting to see suppliers try to pass on costs associated with tariffs. Uncertainty on the trade front continues to keep agricultural markets on the defensive.” (Food, Beverage & Tobacco Products)
- “Down month-to-month, but up over last year.” (Miscellaneous Manufacturing)
- “Anticipated large export orders did not materialize. As a result, expected U.S. production has decreased.” (Fabricated Metal Products)
- “Dealer inventories have rebounded, and overall customer market has softened, resulting in corrections to near-term production schedules and a tentative forecast outlook.” (Machinery)
- “Export markets continue to weaken for plastic resins — Mexican producers are actually trying to sell product back into the U.S. due to weak in-country demand.” (Plastics & Rubber Products)
- “Our outlook for the first quarter of 2020 is positive. We have secured contracts from a number of former customers and expect sales growth of about 5 percent over Q4 of 2019.” (Textile Mills)
- “The construction market seems to have slowed for end of year. Overall, it’s marginally up.” (Nonmetallic Mineral Products)