It has been exactly one year since the US-China trade conflict plunged the US manufacturing sector into recession. The recession lasted for five months, but since then the factories have been back. U.S. manufacturers recorded their best pace in nearly two years on Tuesday.
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The industry has not been in such a good mood since November 2018, according to the August Gust Survey of the Institute of Supply Management.
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The index of ISM’s procurement managers stood at at 56 in August Gust, as economists expected. Numbers greater than 50 indicate expansion in any area.
And, even better, the index for new orders rose to 67.6, the highest level since January 2004.
Last August, the PMI fell below 50 for the first time in three years, and President Donald Trump’s trade war caused factories to collapse to the lowest level in less than 3.5 years. The industry returned in January, sparking an epidemic.
“After bringing coronavirus production activity to historic historic lows, the sector continued its recovery in the aftermath, in the first full month of operations after the supply chain resumed, and arrangements were made for employees to return to work,” said Timothy R. Filor. About the report of the ISM Manufacturing Business Survey Committee, the Gust. It is easy to forget that the economy is not far away
With such numbers, it can be difficult to remember that the economy is far from normal.
Despite the surge in economic data, the Federal Reserve warns that the path to recovery is ultimately linked to the path of the virus: unless the epidemic is completely under control or under control, the economy will not be able to move forward. Was back before that.
With schools resuming, the flu season around the corner and Congress unable to agree on another stimulus package, many strangers are heading into the fall.
Chris Rupki, chief financial economist at MUFG, said time will tell whether companies should be more aware of expansion plans and limited inventories and capex in the current environment.
He added, “The economy has not been able to normalize regardless of what this enthusiastic survey of purchasing manager executives tells us.”
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