The Institute for Supply Management is expected to report on Tuesday that its August manufacturing index remained in contraction below the 50 threshold, extending a run of weak factory activity as tariff-driven costs weighed on producers. Economists at JPMorgan and Wells Fargo forecast a reading near 48.
The ISM survey, released on the first business day of each month, tracks new orders, production, employment and prices paid across US factories. A number below 50 signals contraction. The prices-paid subindex has stayed elevated through 2026 as import duties on steel, aluminium and components pushed up manufacturers' input costs.
Recent corporate activity has been mixed. Genentech, a Roche unit, announced a $750 million injectable manufacturing facility in Hillsboro, Oregon, underscoring continued investment in domestic pharmaceutical production. Broader industrial demand has softened, however, with survey respondents citing order cancellations and cautious capital spending.
A sub-50 print would reinforce pressure on the Federal Reserve to consider rate cuts at its September meeting, following Chair Jerome Powell's dovish signals at Jackson Hole. Bond markets have already priced in easing, and a weak manufacturing reading would strengthen the case for a lower policy rate.
The data arrives alongside separate S&P Global manufacturing figures due the same day, offering investors a fuller picture of factory conditions heading into autumn.