Growing "Signs Of Distress" In US Manufacturing Data Demolish Decoupling Dream

Tyler Durden's picture

Following the weakness in global PMIs, and yesterday's Chicago PMI collapse, US Markit Manufacturing PMI dropped to cycle lows at 51.3 from 52.5 (very slightly better than expectations of 51.2) with job growth at 5-month lows, production at slowest in 28 months, and work backlogs tumbling to the lowest since Sept 2009. Then ISM Manufacturing hit, hovering at its weakest in 7 years rose modestly to 49.5 but remains in contraction for the 5th month in a row (longest streak since 2009). As Markit concludes, "the February data add to signs of distress in the US manufacturing economy."

Remember the "America is an island and the rest of the world's economic collapse doesn't matter" meme... well that is over!! Cycle lows for Manufacturing PMI and 5th month of contraction for ISM Manufacturing


As Output plunges to cycle lows...

While ISM data showed a modest rise, New Orders were unchanged as Import and Export Orders fell.

Of the 18 manufacturing industries, nine are reporting growth in February in the following order: Textile Mills; Wood Products; Furniture & Related Products; Miscellaneous Manufacturing; Electrical Equipment, Appliances & Components; Food, Beverage & Tobacco Products; Chemical Products; Primary Metals; and Paper Products.

The seven industries reporting contraction in February — listed in order — are: Apparel, Leather & Allied Products; Petroleum & Coal Products; Computer & Electronic Products; Printing & Related Support Activities; Transportation Equipment; Plastics & Rubber Products; and Fabricated Metal Products

ISM Respondents show a mixed bag:

  • "Low oil prices and reduced activity continue affecting our business." (Petroleum & Coal Products)
  • "U.S. business demand is solid; international demand is soft." (Chemical Products)
  • "Mobility spend is up." (Computer & Electronic Products)
  • "Business has to get better. And it appears it is. Healthy backlog for 2016." (Fabricated Metal Products)
  • "Very strong demand for product. Material availability very good and commodity pricing continues to be depressed." (Machinery)
  • "Airlines are still ordering planes and spare parts for plane galleys." (Transportation Equipment)
  • "Market is beginning to trend up with spring season on its way." (Wood Products)
  • "Not seeing impact from global economic volatility or oil prices. Business is strong and growth projections remain the same." (Miscellaneous Manufacturing)
  • "Orders are coming in stronger than expected." (Furniture & Related Products)
  • "Still a bit sluggish." (Food, Beverage & Tobacco Products)

Commenting on the February manufacturing data, Chris Williamson, chief economist at Markit said:

“The February data add to signs of distress in the US manufacturing economy. Production and order book growth continues to worsen, led by falling exports. Jobs are being added at a slower pace and output prices are dropping at a rate not seen since mid-2012.


“The deterioration in the manufacturing sector’s performance since mid-2014 has broadly tracked the dollar’s rise, which makes US goods more expensive in overseas markets and leads US consumers to favour cheaper imported goods.


“With other headwinds including the downturn in the oil sector, heightened uncertainty due to financial market volatility, global growth worries and growing concerns about the presidential election, it’s no surprise that the manufacturing sector is facing its toughest period since the global financial crisis.

Charts: Bloomberg

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pillory-hillary's picture

houston..we have a problem...cruz is out of the race!  vote trump!

NoDebt's picture

I'm glad we don't manufacture anything in the US any more or this might be a problem.

Mini-Me's picture

Wrong.  We build F-35s that can't fly and cluster bombs the Saudis drop on Yemeni civilians.  

KnuckleDragger-X's picture

The F-35 can fly, it can't do anything else, but who gives a shit.......

Kina's picture

This is of course is expected. You can only fabricate for so long before reality pushes its head out.

Seasmoke's picture

More bad news. Higher and higher we go. Everyone into the USD !!!!

herkomilchen's picture

ISM manufacturing 49.5 beat expectations of 48.5.

NoDebt's picture

Beating expecations ALL the way down.

KnuckleDragger-X's picture

Killing us slowly, because we no longer deserve a quick, clean death.....

buzzsaw99's picture

zirp beats expectations of nirp too

youngman's picture

and Gold and Silver being hit back down....cant have another currency ya know

Serfs Up's picture

WTF cares?  

These fucked up numbers were apparently splenderific enough to cause the dollar AND stawks to go up while pummelling gold.

Mission accomplished.

Doing god's werk.  Thanks bankster tribe, your efforts will be long remembered by me.

/My time.  It is coming.

Government needs you to pay taxes's picture

The banksters and politicians must surely know that eventually, they will be swinging from trees.  Janet Yellen's public question about the legality of NIRP speaks to this.  She wont do it unless/until she gets an official nod from the 'Just-us' system that it is legal. . .

KnuckleDragger-X's picture

You'll never get to whore yourself out on CNBC talking like that......

silverer's picture

Not what the president said. But that's why Americans vote for standard lifer-type politicians. Most Americans apparently have a great affection for criminals and liars.

bbq on whitehouse lawn's picture

It is difficult to explaine evil to someone who has never experienced it. Its even more difficult to remove hope from those who need it most.

Archetype's picture

We are obviously back in BTF[insert whatever you like here]-mode again.

frankly scarlet's picture

debt saturation = less demand = less supply = less jobs and the spiral continues that way... but heh look at those markets rebuff this data trend. the PPT out of the ESF at Treasury must be working overtime shifts so some are enjoying larger takehome.... and there's money to be made off of the institutional players no matter which way the ball bounces if you're an insider...

allamerican's picture

mrkt ramps, this is a gift!  no matter how you look at, this is a fucking gift..

thismarketisrigged's picture





NEOSERF's picture

If by decoupling you mean the stock market from reality...that's already happened...I cannot remember a time where the markets were so divorced from all the recessionary data.

lemontree2's picture

Stawks. All that matters. They go up. Superfly snd superich Get richest. Only in financials

iggenFlot's picture
iggenFlot (not verified) Mar 1, 2016 11:12 AM

Let's face it, things are really not that bad.

TheAntiProgressive's picture

We don't need no stinking manufacturing, we push around little pieces of paper over here creating fiat out of thin air, no need to break a sweat with that program.  Then we trade the worthless little pieces of paper//electrons for your hard goods.  Works for us because then we get to financialize it all and make debt serfs out of our population.