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American manufacturers have declared a sharp drop in new orders and new jobs in February, fueling the fears that the economy loses its momentum, the expectations of growth that have also dropped.
The ISM manufacturing purchasing managers index dropped on Monday at 50.3 in February from 50.9 in the previous month, leaving it just above the contraction territory, while the secondary indices highlighted a strong drop in new orders from 55.1 to 48.6.
The estimate of the Federal Reserve Bank of Atlanta of American GDP growth, also published on Monday, said a drop of 2.8% in the first quarter, a much higher drop than the 1.5% drop it had suggested on Friday.
The figures occur in the midst of increasing concerns concerning the impact that the aggressive trade policies of President Donald Trump will have on the American economy, while companies weigh the prospect of high prices on the largest partners in the country.
Trump said he was planning to impose 25% prices in Mexico and Canada from Tuesday and double the China obligation at 20%.
However, on Sunday, the secretary of commerce, Howard Lungick, suggested that the extent of the prices should be finalized, describing the situation as “fluid”.
Economists have said that uncertainty about prices weigh on confidence, adding that a leap accent in a price gauge paid in the ISM report underlined increasing concerns concerning the inflationary impact of samples.
“Several sectors see orders drying in the midst of high uncertainty in terms of commercial policy,” said Oliver Allen, principal American economist at Pantheon Macroeconomics.
“At least part of the previous increase in the ISM manufacturing index from October to January reflected the manufacturers to hurry to finish orders before the prices are applied-a precipitation that now seems to get rid of,” he added.
On Monday, the S&P 500 Blue Chip lost 1.3% and the Nasdaq composite heavy technology dropped by 1.9% after the publication of the manufacturing data in February, extending a recent slide motivated by increasing concerns concerning the health of the world’s largest economy.
The first quarter growth rate figure of the Atlanta Fed Fed would mark a change after the US economy increased at a rate of 2.3% in the fourth quarter, although it is a lower than expected end to a year supported by a resilient American consumer.
The clear drop in the GDPNOW indicator has been influenced by poor commercial data, low construction figures and reading the ISM Terne.
Goldman Sachs economists were more optimistic about GDP, however, leaving their follow -up estimate for the first quarter unchanged at an annualized growth rate of 1.6%.
Jack Kleinhenz, chief economist of the National Retail Federation, said the American economy had entered 2025 with a “good amount of momentum”.
But he added that the image became less clear, following “currents”, including immigration restrictions, prices and deregulation.
“Although recent economic data remains strong, we are concerned about the risks down,” he said.
