The U.S. economy remains in a slump and February data on manufacturing activity are expected to show continued contraction.
Industry reports from the Purchasing Management Association of Chicago and National Association of Purchasing Management offer the first glimpses of conditions during the month and aren’t likely to signal the economy is turning the corner–yet. But auto sales should improve from December’s paltry performance.
The Chicago purchasers release their report Wednesday, followed by the national report Thursday. Both offer a snapshot of conditions in the manufacturing sector.
A BridgeNews survey of forecasters put the national index at 42.0, up from 41.2 in January. If forecasters are on track, the report would signal the seventh straight month of readings below 50.0, which is seen as contractionary. A reading above 50.0 is viewed as expansionary.
Analysts say manufacturing is among the first parts of the economy to see the impact of changes in interest rates and other factors that slow or recharge growth.
The NAPM report isn’t likely to offer much to get excited about, but early indications of auto sales show that predictions of gloom and doom may have been premature.
Although industrywide sales are expected to drop about 11.0 percent from year-ago levels, the numbers are an improvement from December’s 15.5 percent decline.
“This month’s results will be well above December’s surprisingly weak rate and give further evidence that U.S. vehicle sales are not in a severe sustained decline,” said David Healy, analyst with Burnham Securities.
