‘Not a good sign.’ Weak demand continues amid tariff uncertainty: PMI

Core Insights - The manufacturing industry is experiencing contraction, with the Purchasing Managers' Index (PMI) at 49.1% in September, indicating a slight improvement from August but still below the threshold of 50% that signifies growth [1] Demand Indicators - Demand remains weak, with three out of four subcategories showing poor performance; however, backlog orders increased slightly to 46.2%, potentially due to a rise in new orders in August [2] - New export orders significantly declined by 4.6 points to 43%, reflecting the impact of tariff-related news [3] - The customer inventory index decreased to 43.7%, suggesting a faster rate of contraction, which may lead to increased orders from customers in the future [3] Production and Supplier Performance - Production saw a rise of 3.2 percentage points to 51%, attributed to an uptick in orders from August [3] - Suppliers delivered faster in September, with the supplier deliveries index at 52.6%, although it still indicates slower delivery performance for the second consecutive month [4] Employment Trends - The employment index improved to 45.3%, up 1.5 percentage points from August, but comments from the survey indicate more negativity regarding layoffs than hiring [5] Economic Impact - The manufacturing sector's gross domestic product contracted by 67% in September, a slight improvement from 69% in August, highlighting ongoing struggles due to staff reductions, hiring freezes, and price increases [6]