US: ISM Manufacturing PMI declines to 48.4 in December vs. 48.5 expected

Business activity in the US manufacturing sector contracted for the second straight month in December with ISM’s Manufacturing PMI declining to 48.4 from 49 in November. This reading came in slightly below the market expectation of 48.5.

The US Dollar Index edged higher in an initial reaction and was last seen losing 0.45% on the day at 104.22. Further details of the publication revealed that the Prices Paid Index slumped to 39.4 from 43 and the Employment Index improved to 51.4 from 48.4.

In this way, manufacturing contracted again in December after expanding for 29 straight months.

Panelists’ companies continue to judiciously manage hiring. The month-over-month performance of supplier deliveries was the best since March 2009.

Managing head counts and total supply chain inventories remain primary goals as the sector closes the year. More attention will be paid to demand as we enter the first quarter to shore up order books for the next six to 12 months.