04 September 2012 16:54 [Source: ICIS news]
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The Institute for Supply Management (ISM) said that its closely watched purchasing managers index (PMI) fell just slightly by 0.2 percentage points in August from July to 49.6%, but it marked the lowest reading for the index since July 2009.
US manufacturing industries entered a period of contraction in June this year when the PMI fell below 50% for the first time in 33 months to 49.7%. The index recovered marginally in July to reach 49.8% but was still indicating contraction in manufacturing.
The PMI is a composite of supplier responses to the ISM’s monthly survey of 10 different business performance measures in 18 major manufacturing sectors.
A PMI reading above 50% indicates the
Bradley Holcomb, the institute’s survey manager, said that the PMI was pulled lower in August in part by a 0.9-point decline in the component index for new orders for manufactured goods, falling to a reading of 47.1%, also a third month of downturn.
In addition, the component index for production fell by a sharp 4.1 percentage points to 47.2% last month, he said, the first decline in this measure since May 2009 when the
Holcomb said that comments from survey respondents “generally reflect a slowdown in orders and demand, with continuing concern over the uncertain state of global economies”.
Among the 18 manufacturing industries tracked by ISM, only eight reported some growth in August, with chemicals production among them. Two industries, including plastics, were flat during the month while eight others reported declining activity.
An unidentified chemicals sector official was quoted as saying that “Lacklustre demand continues in all regions of the world and is supporting much lower raw materials prices in the second half of 2012”.
($1 = €0.79)
Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy
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