Three new readings on the economy showed a slowdown in August as markets and policymakers await Friday’s jobs report.
Surveys of companies’ credit managers first signaled August’s slower pace when compared with July. An index generated from the surveys weighed in at 52.0 last month, down from 53.5 in July.
Both readings produced by the National Association of Credit Management show the economy expanded. Any reading below 50 would suggest an economic contraction. August’s reading was as low as the index had registered in more than two years.
Surveys of companies’ purchasing managers similarly reported a slower pace in August. The purchasing managers index from the Institute for Supply Management fell to 49.4, or just below a neutral 50, from 52.6 in July.
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“We have been getting lots of inquiries, but not a lot of sales order placements,” a chemical products purchasing manager noted in the ISM survey.
A regional survey of purchasing managers in Missouri, Kansas and seven other states also showed a slow pace in August.
Conducted by Creighton University, the survey showed the Mid-America Business Conditions Index climbed a bit, to 47.8 from 47.6 in July. Both month’s readings, however, indicate a declining pace for the economy.
Creighton’s index for Kansas climbed to 47.6 from 47.0. Its Missouri index fell to 48.5 from 52.3.
Other economic reports have been mixed, but weakness in these three reports suggests that job growth in August, which will be reported Friday, may have ebbed as well.
The monthly jobs report generally gets greater attention because of its significance to the Federal Reserve, which has been looking for reasons to raise interest rates for the first time since December. A weak jobs report likely would delay Fed rate action.