‘Worse than Great Recession’: US manufacturing contracts for 6th straight month as tariffs bite
US manufacturers said that the sweeping import duties were making it difficult to manufacture goods in the US.
WASHINGTON – US manufacturing contracted for a sixth straight month in August as factories dealt with the fallout from the Trump administration’s import tariffs, with some manufacturers describing the current business environment as “much worse than the Great Recession”.
The Institute for Supply Management (ISM) survey on Sept 2 also showed some manufacturers complaining that the sweeping import duties were making it difficult to manufacture goods in the US.
President Donald Trump has defended his protectionist trade policy, which has raised the nation’s average tariff rate to the highest in a century, as necessary to revive a long-declining US industrial base.
That was reinforced by government data showing spending on the construction of factories dropped in July and was down 6.7 per cent from a year ago.
Mr Trump said on Sept 2 that his administration would ask the Supreme Court for an expedited ruling on his tariffs after a US appeals court ruled on Aug 29 that most of them were illegal, adding more uncertainty for businesses.
Mr Stephen Stanley, chief US economist at Santander US Capital Markets, said: “I continue to see the broad economy generally and the manufacturing sector in particular as in a holding pattern until tariff-related uncertainty recedes.”
The ISM said its manufacturing purchasing managers’ index (PMI) edged up to 48.7 in August from 48.0 in July. A PMI reading below 50 indicates contraction in manufacturing, which accounts for 10.2 per cent of the economy.
Read More: Here