The U.S. manufacturing sector contracted in March, Manufacturing PMI® registered 49%, 1.3 percentage points (pp) lower compared to the 50.3% recorded in February, after two consecutive months of expansion preceded by 26 straight months of contraction.
Regarding the overall economy, this figure indicates that the economy continued in expansion for the 59th month after one month of contraction in April 2020. (A manufacturing PMI® above 42.3%, over a period of time, generally indicates an expansion of the overall economy.)
The Employment Index registered 44.7%, down 2.9 pp from February’s figure of 47.6%. Prices Index registered 69.4% in March, elevating 7 pp compared to the February reading of 62.4%, indicating raw materials prices increased for the sixth straight month after a decrease in September. New Orders Index contracted in March for the second consecutive month after three consecutive months of expansion, registering 45.2%, a decrease of 3.4 pp compared to February’s figure of 48.6%. This is the lowest reading since May 2023 (43.4%) for the New Orders Index,
New Export Orders Index contracted in March after expanding for two consecutive months, registering 49.6% in March, down 1.8 pp from February’s reading of 51.4%. “The New Export Orders Index reading indicates that export orders reversed course after growing in February for a second consecutive month. This brief period of expansion followed an ‘unchanged’ status (a reading of 50%), preceded by six straight months of contraction. New export orders contracted as panelists’ comments cited Canadians’ lack of desire to purchase U.S. goods due to the friction between the countries,” says Timothy Fiore, Chair of the Institute for Supply Management.
Imports Index showed growth for the third straight month in March, with a reading of 50.1% indicating marginal expansion, 2.5 pp lower than the reading of 52.6% reported in February. “Imports remained in expansion as buyers try to get ahead of tariffs by pulling forward future deliveries to the extent that is possible,” says Fiore.
The Inventories Index registered 53.4% in March, up 3.5 pp compared to the reading of 49.9% reported in February.
Read the ISM release.
