Home Fashion US’ flash manufacturing PMI at 46.2 in Dec ’22: S&P Global

US’ flash manufacturing PMI at 46.2 in Dec ’22: S&P Global

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US’ flash manufacturing PMI at 46.2 in Dec ’22: S&P Global

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US’ flash manufacturing purchasing managers’ index (PMI) is registered at 46.2 in December 2022, down from 47.7 in November, signalling a solid deterioration in operating conditions across the goods-producing sector, according to latest flash PMI data from S&P Global. The country’s PMI composite output index stood at 44.6 in December 2022, a 4-month low.

The country’s flash manufacturing output index was 46 in December, a 31-month low.

US’ flash manufacturing purchasing managers’ index (PMI) is registered at 46.2 in December 2022, down from 47.7 in November, signalling a solid deterioration in operating conditions across the goods-producing sector, according to latest flash PMI data from S&P Global. The country’s PMI composite output index stood at 44.6 in December 2022, a 4-month low.

The downturn was the fastest since the initial lockdown period in 2020 and driven by subdued demand and a faster fall in output.

Manufacturers registered one of the sharpest declines in new orders since the 2008-9 financial crisis during December, as customer spending waned. The further acceleration in the pace of contraction in new business led to a steeper decrease in production levels, according to S&P Global.

On a more positive note, inflationary pressures subsided notably at the end of the fourth quarter. Another monthly improvement in supplier delivery times, alongside muted demand for inputs, led to the slowest rise in cost burdens since July 2020. Lower prices for fuel and metals, especially steel, were often mentioned by panellists.

Customer demand weakness, however, and efforts to stay competitive, resulted in a moderation in the pace of output charge inflation during December. Selling prices rose at the softest pace since October 2020 as firms sought to pass through any cost savings made.

Sufficient stocks of inputs and a further reduction in new orders led to the sharpest contraction in purchasing activity in over two-and-a-half years.

The level of work-in-hand (but not yet completed) fell at one of the sharpest rates since 2009, as sales contracted and delayed material deliveries arrived. Lower levels of incomplete work and muted demand led to broadly unchanged employment during December.

Finally, output expectations among manufacturing firms strengthened during December. The degree of optimism reached the highest for three months, but was notably still far weaker than the long-run series trend.

US’ private sector firms signalled a further decline in output during December. The downturn gathered pace, as business activity fell at the joint-sharpest rate since May 2020. Manufacturers registered steeper decreases in output, as weaker demand conditions, inflation, and hikes in interest rates dampened activity levels, S&P Global’s flash PMI data further suggested.

Pressure on purchasing power among customers and company balance sheets led to a strong decline in new orders, and one that was the fastest since May 2020. Weak demand conditions were broad-based, though manufacturing firms saw a steeper decrease in new orders compared to their service sector counterparts. While total new export orders contracted further in December, down for a seventh straight month, the rate of decline softened slightly.

Continuing the downward trend seen since June, average input prices increased at a notably softer pace in the final month of the year. Cost burdens rose at the slowest pace since October 2020 and at a rate that was broadly in line with the series’ long-run average. Companies noted that reduced demand for inputs dampened supplier price hikes, with lower costs reported for fuel and metals in particular.

In an effort to drive sales and pass through any cost savings, private sector firms recorded a softer uptick in output charges during December. Easing to the slowest in over two years, the rate of selling price inflation was only marginally faster than the long-run series average. Moderations in output price hikes were most notable in the manufacturing sector.

Employment rose only marginally as manufacturers signalled broadly unchanged workforce numbers on the month. Weighing on total employment growth were a growing number of reports of lay-offs following weak demand.

Meanwhile, backlogs of work declined for the third month running in December, albeit at a softer rate.

Private sector business confidence was weaker than the series trend again at the end of 2022. Although still anticipating higher output over the coming year, expectations were among the lowest in over two years.

Fibre2Fashion News Desk (DP)

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