American manufacturing continued to grow in February, but at its slowest pace in seven months, according to the latest S&P Global US Manufacturing PMI report.
The PMI rating dropped to 51.6 in February from January’s 52.4 result amid slower increases in new orders due to extreme weather and tariffs affecting international trade, the S&P Global report said.
Chris Williamson, chief business economist at S&P Global Market Intelligence, said the latest result, which marks the weakest expansion since July 2025, further indicates that the overall pace of economic growth has slowed down in recent months.
The PMI marks the country’s seventh straight month above the 50.0 threshold that separates growth from contraction
Export orders fell for the eighth month in a row, reaching their steepest decline since April 2025. Companies reported that tariffs particularly hurt sales to Canada. In response, U.S. manufacturers added very few new workers in February as backlogs of work decreased.
“Production growth slowed in response to a near-stalling of orders from customers, with exports falling especially sharply. Factory payroll growth was also barely changed, as concern over order book health caused a growing reticence to add to workforce numbers,” Williamson explained.
Vendors also took longer to deliver materials, with manufacturers reporting low stock availability, transportation delays, and weather disruptions affecting suppliers. This led many companies to use their existing material inventories, which declined for the first time in seven months.
“Businesses were often disrupted by extreme weather, which has clouded insights into the underlying strength of economic growth and suggests we may see some rebound once the weather clears,” Williamson noted.
S&P Global reported slower inflation in input costs than in January, remaining below the peaks seen in 2025. Tariffs and higher raw material prices continued to drive up costs for manufacturers.
Despite these difficulties, manufacturers expressed greater confidence about future production. Business optimism reached its highest level in eight months, supported by planned new product launches and expansion strategies.
However, Williamson pointed out that uncertainty regarding the political environment, particularly concerning tariffs, continues to hamper confidence, hiring, and investment – a situation likely to persist in the coming months.
