Economic Buzz: US manufacturing growth stays strong in June but slows slightly

The US manufacturing sector continued to expand in June, although growth slowed slightly compared with May. The S&P Global US Manufacturing PMI eased to 53.9 in June from 55.1 in May, marking the 11th straight month above the 50.0 level that signals expansion.

Production and new orders continued to grow, supported by new product launches and advance orders from customers looking to avoid expected price increases. However, both output and new order growth eased, with new orders rising at their slowest pace since March. Export orders declined for the 12th consecutive month, mainly due to tariffs and weaker overseas demand.

Employment remained the weakest area, with manufacturers cutting jobs at the fastest pace since May 2020, and the sharpest non-pandemic decline since October 2009. Rising orders and lower staffing also led to a modest increase in backlogs.

Companies increased purchasing activity and built input inventories at the strongest pace since May 2025 to protect against supply disruptions, shipping delays and port congestion. While input costs remained historically high due to tariffs and higher raw material prices, both input cost inflation and selling price inflation eased to three-month lows.

Business confidence weakened for the second consecutive month, falling to its lowest level since October 2025, as concerns about the domestic economy continued despite hopes for easing inflation and geopolitical tensions.

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