February Manufacturing Growth Slows Amid Demand, Production Softness, 2 Surveys Show

03:34 PM EST, 03/02/2026 (MT Newswires) -- Growth in the US manufacturing sector slowed in February sequentially amid demand and production softness, two separate surveys showed Monday.

The Institute for Supply Management's purchasing managers' index ticked down to 52.4 last month from 52.6 in January. The consensus was for a 51.5 reading in a survey compiled by Bloomberg. A reading above 50 indicates the manufacturing sector is generally expanding.

The new orders index fell to 55.8 from 57.1, while production dropped to 53.5 from 55.9. The employment measure rose to 48.8 from 48.1, but remained in contraction for the 29th straight month. The prices gauge jumped to 70.5 in February from 59 the month prior, marking its highest reading since June 2022, according to the ISM survey.

"The ISM manufacturing index remained well in expansion territory in February, bolstering our call for an upswing in the sector after three years in the doldrums," Matthew Martin, senior US economist at Oxford Economics, said in remarks e-mailed to MT Newswires. "High steel and aluminum prices linked to tariff policy are the largest gripe, while renewed tariff uncertainty and higher global oil prices in response to the US-Iran conflict could keep producer prices elevated in the near-term."

On Saturday, the US and Israel launched military strikes across Iran, killing Tehran's Supreme Leader, Ayatollah Ali Khamenei. Iran retaliated by targeting US military bases across a number of countries in the Middle East.

US benchmark equity indexes were mixed intraday Monday, while oil prices surged.

Separately, S&P Global (SPGI) said Monday its manufacturing PMI dropped to 51.6 last month from 52.4 in January, marking a seventh consecutive monthly expansion, though the growth rate eased to the weakest since July.

New orders and output increased at slower rates, partly due to extreme weather and tariffs affecting international trade. Employment growth was "muted" in February, the data provider said.

"Although cost inflation remained elevated, often linked to tariffs, it is running lower than the peaks seen last year, and stiff competition has limited the pass through to selling prices, which rose in February at the slowest rate for over a year," S&P Global Market Intelligence Chief Business Economist Chris Williamson said. "While this is good news for inflation, it hints at downward pressure on profits."

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