- Prior 52.0
Key findings:
- Solid upturn in output as order book growth
sustained - Tariffs push up input costs and output charges
- Sentiment improves and employment growth hits
highest since September 2022
Comment:
Chris Williamson, Chief Business Economist at S&P
Global Market Intelligence
“June saw a welcome return to growth for US
manufacturing production after three months of decline,
with higher workloads driven by rising orders from both
domestic and export customers. Reviving demand has
also encouraged factories to take on additional staff at a
rate not seen since September 2022.
“However, at least some of this improvement has been
driven by inventory building, as factories and their
customers in retail and wholesale markets have sought
to safeguard against tariff-related price rises and
possible supply issues. It therefore seems likely that we
will get pay-back in the form of slower growth as we head
into the second half of the year.
“These price pressures are already building, with
factories reporting steep cost increases again in June,
linked to tariffs, which they are passing through to
customers. The big question of course is whether this
merely results in a short-term change in the price level
rather than a more worrying return of stubborn inflation.
“More encouragingly, business confidence has
continued to improve from the low-point seen in April,
with US manufacturers becoming more optimistic in the
face of fewer trade and tariff worries compared to the
heightened uncertainty seen in April, That said, many
firms remain cautious as they await news of trade deals
as the deadline for paused tariffs draws closer.”
This article was written by Giuseppe Dellamotta at www.forexlive.com.