Capital Economics said the ISM’s May report (which came in at 49.6 for May, just under the 50 threshold that indicates growth) meant it “increasingly looks like the worst case scenario of a severe recession has been averted.”
Joshua Shapiro, chief U.S. economist at forecasting firm MFR Inc., said that while today’s ISM report (at 50.2) was the first month of growth after four straight months of contraction, “an increasingly constrained consumer, deepening woes for the housing sector, and a degree of unwanted inventory accumulation… will all weigh on overall manufacturing output, which we expect to remain weak for some time.”
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