Trump's trade war isn't hurting manufacturing . . . yet

 - by New Deal democrat

The Trump Administration's trade war hasn't hurt manufacturing and production yet. At least that's the message from this morning's ISM report on manufacturing.

According to the ISM:

The September PMI®registered 59.8 percent, a decrease of 1.5 percentage points from the August reading of 61.3 percent. The New Orders Index registered 61.8 percent, a decrease of 3.3 percentage points from the August reading of 65.1 percent.

Here is what the overall index and the leading new orders index look like since the turn of the Millennium (except for this morning's report) (h/t Briefing.com):

Here are the overall and new orders readings from the preceding five months:

Both the overall index, and the new orders subindex, were in the range of earlier readings this year.

Industrial production, particularly in the Oil patch, has been running hot this year.  There has been some evidence of "front-running," i.e., getting orders in before the tariffs take effect, in things especially like weekly railroad carloads. Going forward, what to watch for is new orders falling below their range from earlier this year, i.e., significantly below 60.

But there is no evidence yet of tariffs hurting the sector so far.