ARLINGTON, VA – Mapi Foundation expects modest acceleration in US manufacturing growth over the next two years; then it is expected to decelerate, says Dan Meckstroth, Ph.D., Mapi’s vice president and chief economist.
The US PMI in October was 54.1%, according to the firm, compared to 53.1% in September.
Strong domestic demand is buffering the US from the rest of the world, offsetting weaknesses outside the US, Meckstroth says.
Consumer spending is driving the economy, with the last five quarters consistently good. Consumer spending, in other words, accounts for 70% of all final demand and is driving the economy.
In related news today, the Institute for Supply Management said the November PMI was 48.6%, down from 50.1% the previous month. Economic activity in the manufacturing sector contracted in November for the first time in 36 months, ISM said, while the overall economy grew for the 78th consecutive month.
"The November PMI registered 48.6%, a decrease of 1.5 percentage points from the October reading of 50.1%,” said Bradley J. Holcomb, chair of ISM. “The New Orders Index registered 48.9%, a decrease of 4 percentage points from the reading of 52.9% in October. Ten out of 18 manufacturing industries reported contraction in November, with lower new orders, production and raw materials inventories accounting for the overall softness in November."