**As seen in Risk In The Week report 11/26/22, subscribe at cablefxm.co.uk/reports
October’s gauge of U.S. manufacturing slowed to 50.2 from the prior 50.9, this was slightly better than the consensus forecast of 50.0 but the lowest figure since May 2020. As of October, 6/10 sub-indexes now record below 50.0, the biggest downside changes were seen in backlog orders and supplier deliveries, both slipped from prior expansionary readings. Employment saw a rebound as it came in at 50.0 from the prior 48.7, the subcomponent has seen readings above expansion for 3 out of the last 7 months. To the upside, the largest improvement was seen in the new orders index, however, it remains below its 6-month average at 49.2. The prices paid showed further relief in the inflation front as the index declined to 46.6 from 51.7, this was the lowest level since May 2020. Analysts at Wells Fargo say that the backlog and new orders components suggest there will be a contraction in the goods producing sector by next year. They think that investors will focus on the prices paid index as the 46.6 is well below the high of 87 seen in March, they note that the figure points to further disinflationary pressures coming through the pipeline. The desk at CIBC say that regional indexes throw mixed signals for the ISM, the manufacturing gauge is expected to come slightly above expansionary levels by the bank. They note that production could have received a lift in some sectors as supply chain disruptions continue to ease.
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