US manufacturing hit a 3-year low in December
Manufacturing in the US is in a bad place.
Markit's latest reading on US manufacturing activity in December fell slightly to 51.2 from a preliminary reading of 51.3, though this reading was better than 51.1 that was estimated.
This is the lowest level for the reading since October 2012.
The Institute for Supply Management followed on Monday with its own reading that showed manufacturing in the US is in contraction.
ISM's index came in at 48.2, down from 48.6 in November and below the 49.0 that was expected. December's reading was the lowest since June 2009.
All readings below 50 indicate contraction in the sector.
In a release, Markit said:
"A near-stagnation in new business volumes was the main factor weighing on the headline index in December. Measured overall, new order levels expanded only fractionally and at the weakest pace since September 2009. Anecdotal evidence cited softer underlying demand conditions, intense competition for new work and subdued business confidence among clients. Export sales were also close to stagnation in December, with manufacturers noting that the strong dollar continued to act as a drag on demand from abroad."
In its own release, ISM noted that readings over 43.1 generally indicate expansion in the overall economy, though the manufacturing sector is clearly in contractionary territory.
The lowest component reading in ISM's report was prices paid, which fell to 33.5 from 35.5 as producers continue to see their international customers pressured by the impact of a strong US dollar.
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