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US manufacturing stays weak as Fed cautious on rate adjustments
US manufacturing remains subdued as the Fed holds a cautious tone on rate cuts, balancing inflation risks against slower factory recovery and stable business loan demand.
U.S. manufacturing activity remained in contraction territory for the latest month, signaling ongoing headwinds in industrial output and supply chain recovery. Federal Reserve officials remain uncertain about future rate cuts, emphasizing that strong demand for business loans contrasts with weak factory performance. The ISM index data indicated subdued new orders and persistent cost pressures. Economists warn that sustained weakness could affect employment in industrial regions, while Fed policymakers balance inflation risks against potential growth slowdowns heading into 2026.