August ISM US Manufacturing Index Rises From July, Still Indicates Contraction

10:18 AM EDT, 09/02/2025 (MT Newswires) -- The Institute for Supply Management's US manufacturing index rose to 48.7 in August from 48.0 in July, compared with expectations for a 49.0 reading in a survey compiled by Bloomberg as of 7:35 am ET.

There were increases in the readings for new orders and employment but declines for production and prices.

"In August, US manufacturing activity contracted at a slightly slower rate, with new orders growth the biggest factor in the 0.7-percentage point gain of the Manufacturing PMI," said Susan Spence, chair of the ISM Manufacturing Business Survey Committee. "However, since production contracted at a rate nearly equal to the expansion in new orders, the Manufacturing PMI increase was nominal."

The monthly national manufacturing reading from the Institute for Supply Management is reported as a headline index, with readings above 50 indicating expansion and those below 50 indicating contraction. Component indexes measure new orders, production, employment, and prices.

An increase in the index further above 50 is considered a sign of a strong US manufacturing sector, generally a positive for manufacturing industry stocks. However, if that strength comes with rising input prices due to shortages, that could be a negative for stocks as well as bonds.

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