July ISM Manufacturing PMI Falls to 46.8, Below Analyst Expectations
The report notes that businesses are reluctant to invest in capital and inventory due to current federal monetary policy.
On August 1, ISM released its Manufacturing Purchasing Managers' Index (PMI) report. The report showed that the ISM Manufacturing PMI fell to 46.8 in July from 48.5 in June, below analysts' expectations of 48.8.
The new orders index fell to 47.4 in July from 49.3 in June, and the production index fell to 45.9 from 48.5.
ISM said, "Demand remains weak and companies are reluctant to invest in capital and inventories due to current federal monetary policy and other conditions."
In addition, the July Manufacturing PMI report released by S&P Global drew market attention. The report showed that the manufacturing PMI fell from 51.6 in June to 49.6 in July, close to analysts' expectations of 49.5.A PMI value below 50 indicates that the manufacturing sector is in contraction.
Affected by the ISM manufacturing PMI report, the U.S. dollar index fell back to 104.10 near. The report showed that the manufacturing sector continues to be under pressure, which may force the Federal Reserve to cut interest rates more aggressively.
Gold stabilized around $2,450 as traders focused on the PMI data. In the bigger picture, dovish comments from Fed Chairman Jerome Powell provided support to the gold market.
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