US PMI below 50% for first time since 2009

The US preliminary August PMI slipped from 50.4 to 49.9, the first time since 2009 that this index has fallen below the 50% "recession line".  That's the point at which a majority of respondents see sales, employment, production, etc, lower than in the previous month.

IHS Markit said:

The decline in the headline PMI mainly reflected a much weaker contribution from new orders, which offset a stabilization in employment and fractionally faster output growth.

New business received by manufacturing companies fell for the second time in the past four months during August. Although only marginal, the latest downturn in order books was the sharpest for exactly 10 years. Latest data also signalled the fastest reduction in export sales since August 2009.

It's ominous that it's new orders which are so weak, as they are a lead indicator of sales, production and employment. 

In the chart below I've plotted the PMI as published overlaid with my extreme-adjustment of those data.

The preliminary services PMI also fell sharply.  The average of the manufacturing and services PMIs, both extreme adjusted, is shown below.  It's still a whisker above the 50% "recession line".  But it's also the lowest it's been since 2009 ( a one month downward spike was removed by my extreme-adjustment program).