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American manufacturers have reported a sharp decrease in new requests and employment in February, which raised fears that the economy is losing momentum as growth expectations are also low.
The ISM manufacturing directors index fell on Monday to 50.3 in February from 50.9 in the previous month, leaving higher than the shrinkage area, while secondary indicators indicated a sharp decrease in new orders from 55.1 to 48.6.
The Federal Reserve estimated at Atlanta GDP, which was also published on Monday, indicated a 2.8 percent decrease in the first quarter, a very sharp decrease in the 1.5 percent decrease in its proposal on Friday.
The numbers come amid increasing concerns about the impact of US President Donald Trump’s aggressive policies on the American economy, as companies weigh the possibility of a sharp tariff for the largest partners in the country.
On Monday, Trump confirmed that he will expel his plan to impose tariff fees of 25 percent on Mexico and Canada since Tuesday, despite the suggestion of Trade Minister Howard Lootnick the previous day that the extent and timing of fees still must be placed in the final touches.
Economists said that the uncertainty about the customs tariff was weighing confidence, adding that the sharp jump in a scale of the prices paid in the ISM report indicated increasing concerns about the inflationary effect of fees.
“Many sectors are witnessing orders that dry out amid high uncertainty about commercial policy,” said Oliver Allen, senior American economists in Economic Pantheon.
He added: “At least some of the previous increase in the ISM manufacturing index from October to January, manufacturers reflect in a hurry to complete the requests before applying the customs tariff – a rush now seems to be out.”
On Monday, the Blue Chip S & P 500 stock index closed 1.8 percent less after the worst session this year, driven by the Trump tariff. The heavy nasdaq compound decreased by 2.6 percent.
The growth rate number in the first quarter of the Federal Reserve in Atlanta will celebrate the transformation after the American economy grew at an annual rate of 2.3 percent in the fourth quarter, although this was a weaker end of expected to a year supported by the flexible American consumer.
The acute decrease in the gross domestic product index affected by weak trade data, weak construction numbers and a faded ISM reading.
The economists in Goldman Sachs were more optimistic about GDP, however, leaving their assessment tracking for the first quarter without a change at an annual growth rate of 1.6 percent.
Jacques Kalenins, chief economist in the National Federation for sale, said the American economy had entered 2025 with “a good amount of momentum.”
But he added that the image has become less clear, as a result of “crossed”, including immigration restrictions, definitions and standard organization.
“Although modern economic data is still strong, we are concerned about negative risks,” he said.
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