A new report from the Federal Reserve shows that U.S. manufacturing activity continued to decline in September, while a forward-looking indicator from the Conference Board signaled uncertainty for economic activity ahead, due in part to a sharp drop in factory new orders.
The Fed's data on the manufacturing slump was echoed by the Conference Board's Leading Economic Index report, released on Oct. 21, which recorded a 0.5 percent drop in September-an acceleration from August's 0.3 percent decline.
"Weakness in factory new orders continued to be a major drag on the US LEI in September as the global manufacturing slump persists," Justyna Zabinska-La Monica, a senior manager at the Conference Board, said in a statement.
Manufacturing output fell 0.4 percent last month.
The ongoing manufacturing slump also aligns with recent S&P Global data, which showed the sharpest contraction in factory activity in over a year, driven by drops in both output and new orders.
The Institute for Supply Management also reported its sixth consecutive monthly contraction in its manufacturing activity gauge in September, underscoring ongoing demand weakness and companies' hesitation to invest in new equipment and inventory.
Input costs rose faster than selling prices in September, compressing profit margins and further pressuring U.S. businesses, including manufacturers.
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