- US manufacturing activity grew for the eighth consecutive month in August with slight moderation
- ISM manufacturing index fell one point to 54.6, the second-highest reading since 2022
- Fifteen manufacturing industries reported growth, while wood and chemical products contracted
US manufacturing activity expanded for an eighth straight month in August, with growth moderating only slightly from the fastest pace in four years.
The Institute for Supply Management's manufacturing gauge fell one point to 54.6 in August, according to data released Tuesday. Even so, that marked the second-highest reading since 2022. Figures above 50 indicate growth.
Photo Credit: Bloomberg
The production gauge notched its second-best reading since late 2021. A measure of new orders — a sign of demand — was the weakest since March, though it continued to indicate growth. Factory headcount expanded for a second month, albeit at a slower pace.
Fifteen manufacturing industries reported growth in August, including primary metals, electrical equipment and appliances. Wood and chemical products reported contraction.
The manufacturing sector has gained momentum so far in 2026, reversing a multi-year slump. Factories are benefiting from resilient consumer demand, solid business investment and government outlays on defense.
But they've also had to navigate through a series of challenges, including a war-driven spike in energy prices and supply-chain disruptions.
In August, factories once again faced elevated prices for raw materials and longer lead times on supplier deliveries. ISM's prices index held steady at 71.1, matching the lowest since February.
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About 46% of respondents reported higher prices in August, down from half of respondents in July, according to Susan Spence, chair of the ISM's Manufacturing Business Survey Committee.
Select Industry Comments
“The economy is annoying; it is getting in the way of otherwise good business. We are making great new products but struggling to compete when prices escalate due to things like tariffs and the conflict in the Strait of Hormuz. I fear that the inflation caused by these factors will lead to lower sales and lower spending power of our customers.” — Chemical Products
“Supply chain situation, especially in the electronics market, is going through another crisis even bigger and more complicated than during and post COVID-19. That's mainly due to AI infrastructure and uncertainties in the global market (for oil and other critical supplies) due to war in the Middle East and more complication on trade rules.” — Computer & Electronic Products
“Prices continue to rise on all goods. Suppliers are noting that energy, steel and labor costs are increasing very quickly. We continue to try to move products around to offset costs. We have moved more products to offshore sources to try to minimize cost impacts.” — Machinery
“Commentary this month echoes that of recent months: (1) significant availability/price challenges in commodities heavily consumed by AI, (2) great uncertainty over when the Iran conflict will end, and (3) another round of shifting US tariff policy. Despite these tensions, we continue to focus on what we can control, and the market for our products remains strong.” — Miscellaneous Manufacturing
“High steel and aluminum prices (due to Section 232 tariffs) continue to make profitability a challenge. Uncertainty over the U.S.-Mexico-Canada Agreement is at the forefront of many customer conversations. Our industry has also been hit with countervailing and anti-dumping penalties, further raising the cost of equipment.” — Transportation Equipment.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
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