US S&P Global August manufacturing PMI at 53 vs 49.8 prior

US S&P Global August manufacturing PMI at 53 vs 49.8 prior

The S&P Global August Manufacturing PMI for the United States stood at 53, indicating a modest expansion in manufacturing activity compared to the previous month's reading of 49.8 [2]. The report, released on Monday, September 2, 2025, highlighted a mixed performance in the sector, with several key factors contributing to the slight improvement.

The manufacturing PMI, which measures the activity level of the manufacturing sector, has shown signs of resilience despite the ongoing global trade tensions and recent domestic tax hikes. The August PMI reading reflects a marginal increase in new orders and output, which is a positive sign for the sector. However, the pace of growth remains relatively subdued, indicating that the industry is still facing headwinds.

The report also noted that the subdued demand and the impact of international tariffs continued to weigh on the manufacturing sector. Additionally, rising client costs and higher employer taxes contributed to the overall slowdown. Despite these challenges, the sector's performance remains above the contraction threshold of 50, suggesting that the manufacturing industry is still expanding albeit at a slower pace.

The US Federal Reserve's policy expectations and the potential interest rate cuts have also played a role in the sector's performance. The Fed's hint at easing policy and the possibility of a September interest rate cut have created uncertainty in the market, which may have contributed to the slight improvement in the PMI reading [1].

In contrast, the UK's manufacturing PMI fell to 47.0 in August, marking its first drop in five months and extending the sector's downturn to an 11th straight month [2]. This decline was attributed to subdued demand, the impact of international tariffs, and rising client costs. The UK's manufacturing sector continues to face significant challenges due to global trade tensions and domestic tax hikes.

On the other hand, India's manufacturing PMI rose to 59.3 in August, the fastest growth in over 17 years, despite the US tariffs [3]. The strong domestic demand cushioned the impact of the tariffs, allowing the sector to continue expanding. The report noted that new orders grew strongly, and employment also grew for the 18th consecutive month, although the pace of job creation was the slowest since November 2024.

In conclusion, the US S&P Global August Manufacturing PMI at 53 reflects a modest expansion in the manufacturing sector, with several key factors contributing to the slight improvement. The sector continues to face challenges, but the performance remains above the contraction threshold, indicating that the manufacturing industry is still expanding albeit at a slower pace.

References:
[1] https://www.fxstreet.com/news/usd-jpy-posts-modest-losses-to-near-14700-ahead-of-us-manufacturing-pmi-data-202509012311
[2] https://www.investing.com/news/economic-indicators/uk-manufacturing-pmi-falls-in-august-amid-trade-tensions-tax-concerns-93CH-4217921
[3] https://www.financialexpress.com/policy/economy-manufacturing-defies-us-tariff-concerns-august-pmi-soars-to-17-year-high-new-orders-robust-3963331/