December ISM US Manufacturing Index Falls Unexpectedly From November

10:07 AM EST, 01/05/2026 (MT Newswires) -- The Institute for Supply Management's US manufacturing index fell to 47.9 in December from 48.2 in November, compared with expectations for a 48.4 reading in a survey compiled by Bloomberg.

There were decreases in the readings for production and inventories, gains in the new orders and employment readings, though both remained below the breakeven point, and no change in the prices reading.

"In December, U.S. manufacturing activity contracted at a faster rate, with pullbacks in the Production and Inventories indexes leading to the 0.3-percentage point decrease of the Manufacturing PMI," said Susan Spence, Chair of the ISM Manufacturing Business Survey Committee. "Those two subindexes increased in November, so their contraction this month continues the short-term 'bubble' of improvement indicative in the last several months of PMI data - and a hallmark of recent economic uncertainty in manufacturing."

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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