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ISM manufacturing index falls to lowest level since 2009

January 04, 2016

The US manufacturing sector contracted for the second consecutive month in December, according to the Institute for Supply Management’s purchasing managers index for US manufacturing. The index fell to a reading of 48.2 in December, down from November’s reading of 48.6.

Readings above 50.0 indicate expansion.

Bloomberg reports the reading fell below the median forecast of 49 in its survey of 72 economists. Factories, hobbled by sluggish global growth, cut staff at the end of 2015.

“As the impact of the strong dollar and weak global demand continues to play out, it’s no surprise that we’re seeing these kinds of sub-par prints in manufacturing,” said Millan Mulraine, deputy head of US research and strategy at TD Securities LLC in New York, whose projection tied for the closest in the survey. “As low energy prices continue to have an impact on the energy sector, then we’re likely to see a weak showing in manufacturing for a long time.”

The employment portion of the index fell to a reading of 48.1 in December from 51.3 in November, also reflecting contracting employment levels.