US manufacturing sector contracts for 4th straight month

ISTANBUL

The US manufacturing sector contracted in February for the fourth consecutive month, according to a report by the Institute for Supply Management (ISM).

The ISM manufacturing purchasing managers' index (PMI) came in at 47.7% last month, 0.3 percentage point higher than 47.4% recorded in January, said the ISM report released Wednesday.

While a reading above 50 indicates growth, below that shows contraction.

The market expectation for the index, based on replies from purchasing and supply executives in more than 400 industrial firms, was to come in at 48% in February.

"In the last two months, the manufacturing PMI has been at its lowest levels since May 2020, when it registered 43.5%," said Timothy Fiore, the chair of ISM Manufacturing Business Survey Committee.

The new orders index remained in contraction territory at 47%, although it is 4.5 percentage points higher than 42.5% recorded in January.

The production index came in at 47.3%, which is a decrease of 0.7 percentage point compared to January's level of 48%.

"The February composite index reading reflects companies continuing to slow outputs to better match demand for the first half of 2023 and prepare for growth in the second half of the year," Fiore said.