US Manufacturing Surveys Mixed In October; Prices Down, Production Up

Amid the month-long vacuum of macro data, thanks to the shutdown, 'soft' survey data has become almost the only leg left standing to judge the economy by (absent the housing data).

Following better-than-expected prints across Europe, and beats in Brazil and Canada, this morning's S&P Global US Manufacturing PMI rose more than expected to 52.5 (52.2 exp), up from 52.0 - tracking hard data higher.

BUT...

...as usual in the baffle 'em with bullshit world, ISM's US Manufacturing PMI missed expectations,falling from 49.1 to 48.7 (worse than the 49.5 exp) - the 8th straight month of contraction (below 50)

Source: Bloomberg

according to Chris Williamson, Chief Business Economist at S&P Global Market Intelligence.

Indeed, ISM shows prices falling fast and new orders and employment improving MoM (though both below 50 - contracting).

The index of prices paid for raw materials fell 3.9 points to 58, the lowest since the start of the year. Since a recent peak in April, during the height of the tariffs rollout, the price gauge has dropped nearly 12 points...

Source: Bloomberg

Tariffs remained a key source of higher input costs during October with S&P Global's latest data showing another round of historically elevated inflation – albeit the lowest since February.

Selling prices were raised markedly in response, and to a quicker degree than Septembers recent low.

Finally, Williamson notes that business confidence among producers of consumer goods is now down to its lowest for two years“as firms growing increasingly worried about household spending in the US and falling sales to consumers in export markets.”