Latest / Markets with Megan: A Quick Financial Markets Update / June Manufacturing Report's Impact on Economic Forecasts | Episode 151 | 07-01-24

Transcript

June Manufacturing Report's Impact on Economic Forecasts | Episode 151 | 07-01-24 · Markets with Megan: A Quick Financial Markets Update

• 0:01
  Megan Horneman: We got some more information this morning on the weakening in the economy.
• 0:04
  Megan Horneman: It's Monday, july 1st, and on the first of the month we typically get the ISM manufacturing report.
• 0:11
  Megan Horneman: This report has a level of below 50 or above 50.
• 0:16
  Megan Horneman: If it's below 50, it means the manufacturing sector is contracting and what we've seen is that, despite a brief move to 50 a couple months ago, we are still seeing manufacturing in contraction territory.
• 0:29
  Megan Horneman: So it's been falling now since that peak here in March.
• 0:33
  Megan Horneman: It's at 48.5.
• 0:35
  Megan Horneman: The components that we look at within this report.
• 0:38
  Megan Horneman: Unfortunately, there wasn't much positive in this report.
• 0:41
  Megan Horneman: Much positive in this report.
• 0:48
  Megan Horneman: The only two parts of the segments of the manufacturing sector that actually rose for the month were delivery times and new orders.
• 0:51
  Megan Horneman: So we like to look at things like production that's usually linked to GDP.
• 0:56
  Megan Horneman: That declined, that is, in contraction territory for the first time since February.
• 1:01
  Megan Horneman: And the one was one more positive in this report the prices paid component.
• 1:08
  Megan Horneman: So this isn't the inflation indicator that we'll look at, because it's the prices paid that manufacturers have to pay.
• 1:15
  Megan Horneman: This has been elevated.
• 1:17
  Megan Horneman: It jumped all the way up to 57 last month but it's now fallen back down to 52.1.
• 1:23
  Megan Horneman: Doesn't mean that we're contracting in from an inflation standpoint, it just means that it's not as bad as it was a couple of months ago.
• 1:31
  Megan Horneman: It still is in expansion territory, so we still do have some inflation pressures, but not as bad as they were.
• 1:38
  Megan Horneman: So we'll watch to see how this filters into inflation data.
• 1:43
  Megan Horneman: We'll get some more information next week.
• 1:45
  Megan Horneman: That's all we have today.
• 1:47
  Megan Horneman: We'll be back this week.
• 1:48
  Megan Horneman: It's a short week because the 4th of July holiday, but there is a lot of economic data, so we'll be back to get you some more.
• 1:54
  Megan Horneman: This is Megan Horneman.
• 1:56
  Megan Horneman: You've listened to Markets with Megan.
• 1:58
  Megan Horneman: If you have any questions or comments, please feel free to reach out to podcast at Verdence.
• 2:01
  Megan Horneman: com.
• 2:02
  Megan Horneman: Thank you.