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The net impact of continuing U.S. dollar strength, declining global demand for U.S. products and the slumping energy sector contributed to disappointing preliminary measures of U.S. manufacturing in mid-September as manufacturing activity growth slowed to its weakest point in nearly two years. Manufacturing employment also appeared to take a breather with forecasted manufacturing payroll growth up only slightly-at its weakest level since July 2014.
While the goods-producing sector of the domestic economy disappointed expectations, the services sector turned in somewhat stronger results helping to push estimated third quarter GDP growth to an annualized 2.4%. This follows the rebound in second quarter GDP growth of 3.9% after sluggish first quarter growth of 0.6%.