The condition of the US Economy and how it might change
With the new trade tariffs imposed by Trump on middle eastern nations, the US economy is still to rise from the shambles that it fell into post-2016. Though the outlook of the market might be positive, with more hiring being done and banks easily lending money, economists never this as a sign of good times.
The stock market has been steadily climbing, but the manufacturing sector, which contributes 12% to the country’s economy is facing certain red flags. The manufacturing industry, which has been the economic backbone of the country is facing manufacturing issues.
The overall production by the sector has decreased as compared to last year. The PMI index, which helps predict that the economy is going up or down, has also mediocre scores of this sector. The current rating of 50.1 is the lowest since 2009, which was due to the financial crisis of 2008.
Although one sector might be lagging behind, other sectors are showing small positive signs of growth. As the hiring rate is high, people are now less dependent on the Government for unemployment benefits.
The Banking sector is also enabling the economy to perform better. With banking rules relaxed, it is easier for people to start a new business as loans are easy to get. With new sanctions imposed on a few Chinese companies, some sectors would get affected as China has always been the source of cheap labor and electronics. With this cushion gone, the US economy might face some more trouble in going up.