The index measuring this activity stood at 46.5%, compared to 47.2% in September, according to data published by the professional federation ISM.
Manufacturing activity in the United States deteriorated more than expected in October, with demand remaining weak due to uncertainties that are pushing companies to suspend investments, with some companies also worried about the consequences of the presidential election from November 5.
The index measuring this activity stood at 46.5%, compared to 47.2% in September, according to data published Friday by the professional federation ISM.
An index below 50% means that activity has deteriorated. Beyond that, however, it is growing.
Analysts were counting on a less severe deterioration, and saw the index recovering, to 47.6%, according to the Market Watch consensus.
“Demand remains weak, production has decreased,” commented Timothy Fiore, head of the investigation, quoted in the press release.
“Companies continue to show reluctance to invest in capital and inventory,” he said.
Four days before a particularly close duel in the race for the White House, between Democrat Kamala Harris and Republican Donald Trump, the ISM survey specifies that the companies questioned expressed their concerns, among other things about impacts of the upcoming US election results.
They are concerned about the Federal Reserve’s “ability to continue cutting rates in light of the fiscal policies expressed by both major parties.”
A manager of a transport equipment manufacturer also reported “uncertainty about the outcome of the next elections (which) has led to the preparation of several risk analysis studies”
These studies are “particularly focused on the future of electric vehicle migration and trade restrictions (or) sanctions,” he said.
Former president and Republican candidate Donald Trump has indeed promised to reverse the Biden administration’s investments in the development of electric vehicles. He also wants to generalize high customs duties for all imports.
The United States also experienced several strike fronts in October – notably in ports and at the aircraft manufacturer Boeing – and were hit by two major hurricanes, Helene and Milton.
“Port strikes, hurricanes and elections will affect us all in one way or another,” commented a paper company manager interviewed for the investigation.
The American central bank (Fed) has started to lower these rates, which reduces the cost of credit. Its next meeting will be Wednesday and Thursday, and could see a cut of a quarter of a percentage point.
