Posted September 3, 2019

Manufacturing contracted in August

Manufacturing contracted in August, as the Institute for Supply Management's PMI registered 49.1 percent, a decrease of 2.1 percentage points from the July reading of 51.2 percent.

This is the lowest reading since January 2016, when the index registered 48 percent.

"The PMI contracted for the first time since August 2016 (when it registered 49.6 percent) and ended a 35-month expansion period in which the composite index averaged 56.5 percent. The August contraction ended four straight months of expansion softening," said Timothy Fiore, chair of the ISM Manufacturing Business Survey Committee.

A reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally contracting.

The New Orders Index registered 47.2 percent, a decrease of 3.6 percentage points from the July reading of 50.8 percent. The Production Index registered 49.5 percent, a 1.3-percentage point decrease compared to the July reading of 50.8 percent.