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    US ISM manufacturing PMI is lower than expected at 48.2 instead of 48.6

    by VT Markets
    /
    Dec 1, 2025
    The ISM Manufacturing Purchasing Managers’ Index (PMI) for the U.S. in November was 48.2, which is below the expected 48.6. A PMI below 50 usually indicates a decline in the manufacturing sector. This result follows a trend of difficulties in manufacturing. The PMI is an important indicator of the sector’s health.

    Deepening Contraction

    The November ISM manufacturing number of 48.2 shows a deepening contraction. This is the fourth consecutive month below the 50-point mark, showing a consistent slowdown in the industrial sector. It clearly signals that the Federal Reserve’s tighter policies earlier this year are having a real impact. As a result, interest rate markets are adjusting sharply. The odds of a Fed rate cut by March 2026 have soared to over 65%, up from 45% just a week ago. Traders might think about positions that benefit from falling yields, like buying long Treasury note futures or call options on bond ETFs. This outlook of negative growth is affecting corporate earnings, making stock indices like the S&P 500, which is near 5,400, look vulnerable. We expect more market volatility and are considering ways to protect investments, such as buying VIX calls or SPY put spreads. This strategy is similar to what proved successful during the manufacturing struggles we saw in 2023.

    US Dollar Prospects

    The possibility of earlier Federal Reserve easing makes the U.S. dollar less appealing. The Dollar Index (DXY) has fallen below its 50-day moving average of 104.50 following this news. We think that shorting the dollar against currencies like the Euro or Yen through futures contracts could be a smart move in the coming weeks. Create your live VT Markets account and start trading now.

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