US manufacturing slows

The ISM (Institute for Supply Management) and the PMI (Markit's 'Purchasing Manager Index') are monthly surveys which give a reliable and timely guide to what's happening in the US economy.  I use the extreme-adjusted version of these two time series for my assessment of economic conditions in the USA.  The extreme-adjustment process removes or reduces  "spikes" in the underlying data.  The difference between the adjusted and un-adjusted time series can be seen in the chart below.

Another way to reduce statistical variability is to add together two different series, provided that they are statistically independent.   The ISM and PMI surveys show a similarity in the broad trends, but quite a bit of difference in the month-to-month fluctuations.  So adding them together should reduce random month to month variability.

In the chart below,  the line to concentrate on is the green one, which is the average of the other two series plotted.

The question is: is this downtrend likely to continue?  The Conference Board's leading index, my diffusion index, and my longer-leading index all suggest it is.  I'll talk about them in another post.