US manufacturing ISM expands for the fifth consecutive month - ANZ

Research Team at ANZ, notes that the US July manufacturing ISM eased to 52.6 vs 53.2 in June – slightly below expectations (53), but still the fifth month of expansion.

Key Quotes

“Within the data, new orders held up well (56.9 vs 57.0), suggesting positive momentum going forward. Hiring, however, slipped back to 49.4 (50.4) and prices paid eased (55.0 vs 60.5). June construction spending fell 0.6% following an upwardly revised -0.1% fall in May (previously reported at -0.8%). The weakness in construction spending subtracted 0.5% from Q2 GDP according to BEA estimates.

The recovery in building permits in Q2 may indicate some scope for more robust construction spending in Q3. Given labour market buoyancy and rising levels of household formation, it is difficult to see this weakness in construction being maintained.”