FX.co ★ US Manufacturing Sector Remains in Contraction: ISM

The ISM US Manufacturing PMI increased to 49.1 in September 2025, a rise from 48.7 in August, slightly surpassing the market's forecast of 49.0. This figure represents the seventh month in a row of contraction, yet it is the strongest index noted during this economic slump. While there was a recovery in production, climbing to 51.0 from 47.8, this was counterbalanced by a decrease in new orders, which fell to 48.9 from 51.4. Employment figures continued to decline, though the rate of decline has slowed, moving from 43.8 to 45.3. Additionally, both customers' inventories (decreasing from 44.6 to 43.7) and order backlogs (dropping from 44.7 to 46.2) experienced contraction, suggesting ongoing weak demand. The gauge for input prices decreased slightly to 61.9 from 63.7, yet it remains high, indicating sustained cost pressures, albeit with some reduction. Survey participants highlighted tariffs, high expenses, and weak demand as primary obstacles, with many delaying capital projects, cutting costs, and experiencing postponed orders, particularly in the machinery, metals, and semiconductor sectors.