US March ISM manufacturing 49.0 vs 49.5 expected

• Prior was 49.5
• Prices paid 69.4 vs 65.0 expected– highest since June 2022
• Employment 44.7 vs 47.6 prior — lowest since Sept (and second lowest since 2020)
• New orders 45.2 vs 48.6 prior – lowest since June 2023
• Production 48.3 vs 50.7 prior
• Imports 50.1 vs 52.6 prior

There was a nice two-month run in this report ahead of March but it’s back into negative territory again. Given all the uncertainty around tariffs, this is no big surprise.

The US dollar is mostly taking it in stride as tariff announcements mean far more for manufacturing than the latest sentiment numbers.

• “Complex markets saw a surge in volume buying in anticipation of
  2025 being slightly better than 2024. In March, however, all markets saw
  a slowdown, with fear and inventory stocking to hold through a
  potential crisis.” [Chemical Products]
• “Acute shortages continue to impact supply chain continuity. Chinese
  restrictions on critical minerals such as germanium have caused major
  shortages, resulting in all supply needed in 2025 already assumed — and,
  not surprisingly, significant price increases as a result. Tariffs are
  causing minor ripples at the moment in securing supply, with purchase
  order terms narrowing due to uncertainties. A&D (aerospace and
  defense), which has been very resilient, is starting to see questionable
  medium- to long-term demand due to governmental policy, including
  retaliatory actions taken by foreign countries with foreign military
  sales.” [Transportation Equipment]
• “Customers are pulling in orders due to anxiety about continued
  tariffs and pricing pressures.” [Computer & Electronic Products]
• “Starting to see slower-than-normal sales in Canada, and concerns of
  Canadians boycotting U.S. products could become a reality.” [Food,
  Beverage & Tobacco Products]
• “Business condition is deteriorating at a fast pace. Tariffs and
  economic uncertainty are making the current business environment
  challenging.” [Machinery]
• “New order levels have increased and are better than expected. We
  suspect that our customers are trying to build inventory at current
  prices to get ahead of expected tariff and related cost increases. We
  expect this surge in demand to be short-lived.” [Fabricated Metal
  Products]
• “Demand has been stable, consistent with last year. No evidence of
  growing demand. Tariff impacts and mitigation strategies are a daily
  conversation.” [Electrical Equipment, Appliances & Components]
• “Newly implemented tariffs are significantly impacting gross
  profits. Canada’s new tariffs on U.S. goods are significantly impacting
  orders from that country. Quotes and sales are lower from Europe due to
  the threat of retaliatory tariffs.” [Miscellaneous Manufacturing]
• “Worldwide economic instability has really begun to impact our oil
  and gas business. Aside from the change in the U.S. administration, the
  economies of China, India and Europe are drivers in what we believe is
  the next cyclical trough.” [Petroleum & Coal Products]
• “Bearish market sentiment and tariff applications and costs have
  dominated discussions over the past month and should continue to
  dominate markets until a clear path forward is determined. Overall
  concern is whether or not demand destruction will occur with higher
  pricing.” [Primary Metals]

These comments are not constructive.

This article was written by Adam Button at www.forexlive.com.