U.S. factory activity decreased for a sixth consecutive month in April, marking the longest manufacturing contraction since 2009. Higher
interest rates, lower demand, and rampant inflation are some of the
factors that contributed to the drop, according to Bloomberg.
- The Institute for Supply Management (ISM) said that its manufacturing activity index rose to 47.1 last month, up from 46.3 in March.
- This
is the sixth consecutive month that the index remained below the
50-point threshold, indicating that manufacturing activity is shrinking
but the data shows that the contraction is slowing.
- Factory
employment increased in April and ISM said that manufacturers are
anticipating "growth in the late summer/early fall period."
- The drop in manufacturing activity last month could also be linked to higher commodity prices, including oil, the report said.
- U.S. manufacturing was negatively impacted by lower demand during the pandemic lockdowns.
- Supply chain disruptions and high energy prices also hurt the manufacturing sector in recent years.
