US: ISM Manufacturing PMI rises to 47.6 in August vs. 47 expected

• ISM Manufacturing PMI recovered in August but remained below 50.
• US Dollar Index clings to small daily gains above 103.50.

The economic activity in the US manufacturing continued to contract in August, albeit at a softer pace than July, with the ISM Manufacturing PMI advancing to 47.6 from 46.4 in July. This reading came in slightly better than the market expectation of 47.

Further details of the publication revealed that the New Orders Index edged lower to 46.8 from 47.3, while the Employment Index rose to 48.5 from 44.4. Finally, the inflation component - Prices Paid Index, advanced to 48.4 from 42.6.

"Demand remains soft, but production execution is consistent with new, reduced output levels based on panelists’ companies order books," said Timothy R. Fiore, Chair of the Institute for Supply Management.  

"Prices are generally stable. Sixty-two percent of manufacturing gross domestic product (GDP) contracted in August, down from 92 percent in July, a positive trend for the economy," Fiore added.

Market reaction

The US Dollar Index showed no immediate reaction to this report and was last seen posting small daily gains at 103.70.