The prices subindex had increased significantly to 60.9 (+5.1) because of sticky inflation which was rearing its head recently and this had been depicted in the recent inflation reports.
The decline in new order (49.1, -2.3) was because of a fall in new export order (48.7, -2.9) that outpaced the rise in new local order (Est’d +0.6). This decline in export had already been reported in Q1 2024 US GDP growth report.
https://sg-stock.blogspot.com/2024/04/us-economy-is-hit-with-double-whammy.html
The backlog of order (45.4, -0.9) decreased because of higher production (51.3, -3.3) which exceeded new order and also resulted in the increase in customer’s inventories (47.8, +3.8). Moreover, the expansive production (above 50) also caused an increase in employment (48.6, +1.2).
Overall, the PMI moved back into a contractionary phase (below 50) by decreasing to 49.2 (-1.1). This contraction also corroborated the recent significant decline in the Q1 2024 GDP (1.6%).
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