US manufacturing conditions improve in February - S&P

1st Mar 2024 14:46

(Sharecast News) - US manufacturing conditions improved in February at the fastest pace since July 2022, according to a survey released on Friday.

The seasonally-adjusted S&P Global manufacturing purchasing managers' index rose to 52.2 from 50.7 in January, coming in above the flash estimate of 51.5.

Chris Williamson, chief business economist at S&P Global Market Intelligence, said: "Manufacturing is showing encouraging signs of pulling out of the malaise that has dogged the goods-producing sector over much of the past two years. After a long spell of reducing inventories in order to cut costs, factories are now increasingly rebuilding warehouse stock levels, driving up demand for inputs and pushing production higher at a pace not seen since early 2022. There are also signs of stronger demand for consumer goods, linked in part to signs of the cost of living crisis easing.

"Firms are consequently investing in more staff and more equipment, laying the foundations of further production gains in the coming months to hopefully drive a stronger and more sustainable recovery of the manufacturing economy. "Problems with shipping disruptions and supply chains earlier in the year have eased, taking some pressure off input prices, though factory gate prices are recovering amid stronger customer demand, which will be an area to watch closely in the coming months as policymakers assess the appropriateness and timing of any interest rate cuts."