ut a rebound in demand. Price pressures cooled: input and selling prices rose at the slowest rate in 11 months, but firms still said tariffs were pushing costs up and enabling some pass-through to customers.
Why should I care?
For markets: Factories can’t outproduce their order books forever.
A PMI above 50 is a good headline, but slipping new orders raise the odds that output – and eventually hiring – cools to match demand. That would matter for industrial earnings and logistics, which tend to feel slowdowns early. And while inflation in the pipeline is easing, tariff-linked costs could keep margins and consumer prices under pressure.
The bigger picture: Trade frictions can keep inflation sticky.
Manufacturers sounded cautiously optimistic about the year ahead, but confidence dipped as fresh work didn’t fully replace existing orders. If tariffs keep lifting costs, disinflation gets harder even when growth cools. The broader signal is classic late-cycle tension – firms are still producing and staffing up, but they need demand to catch up, or the adjustment usually comes through output first and jobs later.