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PMI Stays in Contraction Mode

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The manufacturing economy slipped further in May, two months after returning to growth for the first time since 2022. The Institute for Supply Management’s PMI was at 48.7 percent for the month, down 0.5 percentage points from April, representing contraction in 18 of the last 19 months.

“Demand remains elusive as companies demonstrate an unwillingness to invest due to current monetary policy and other conditions. These investments include supplier order commitments, inventory building and capital expenditures,” said Timothy Fiore, chair of the ISM’s Manufacturing Business Survey Committee.

The New Orders Index remained in contraction territory, registering 45.4 percent, 3.7 percentage points lower than the 49.1 percent recorded in April. The May reading of the Production Index of 50.2 percent was down 1.1 percentage points from April and the Prices Index fell 3.9 percentage points to 57 percent.

Fabricated Metal Products was one of seven industries reporting growth in May, a group which included Primary Metals. Machinery and Transportation Equipment saw contraction in May.

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