US Manufacturing Edges Up in August from 8-Month Low, but Trend Remains Weak

Gains in Auto Production, Defense Spending Offset by Drops in Other Areas

US manufacturing output eked out a small gain in August, edging up by 0.1% from July, according to data released by the Federal Reserve on Thursday.

The increase marks a modest improvement from the 0.4% decline seen in July, but analysts warn that the overall trend in manufacturing remains weak.

The latest figures come amid growing concerns about the health of the US economy, with many economists predicting a recession in the coming months.

Key Findings

• Gains in auto production and defense spending helped to boost overall manufacturing output in August.
• However, these gains were offset by declines in other key sectors, such as chemicals, machinery, and computers.
• The overall trend in manufacturing remains weak, with output still below its pre-pandemic levels.

Industry Reaction

"While the August numbers show a slight improvement, they do not change the overall picture of a manufacturing sector that is struggling," said Chad Moutray, chief economist at the National Association of Manufacturers.

"We are seeing weakness in a number of key sectors, and this is likely to continue in the coming months," he added.

Outlook

The future outlook for manufacturing is uncertain, but many economists expect the sector to contract in the coming months as the economy slows.

The Federal Reserve is expected to continue raising interest rates in an effort to curb inflation, which will likely weigh on economic growth and manufacturing activity.