Despite drastically tightening financial conditions, 'soft' survey data on US Manufacturing was expected to rise in October, but - as always - it was mixed:

• Markit's Manufacturing PMI printed higher at 55.7 (marginally higher than September's 55.6 but below the October flash print of 55.9)
• ISM Manufacturing Printed dramatically lower at 57.7 (well below expectations of 59.0 and down from September's 59.8)

It appears ISM is catching down to reality as 'hard' economic data continues to creep lower and disappoint:

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ISM Manufacturing is at its weakest since April 2018...

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ISM's unadjusted new orders tumbled to their weakest since Nov 2016...

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While Markit's Prices Paid index is soaring, ISM's has been falling recently but prices bounced in October as Export Orders collapsed to weakest since Nov 2016...

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So while ISM is a terribly dismal print, and respondents are downbeat - due to tariffs:

“Tariffs are causing inflation: increased costs of imports, increased cost of freight and increased domestic costs from suppliers who import.” (Chemical Products)

“While order intake remains steady, the pace has slowed since the first half the year. Instead of growing, the backlog is declining. We were processing orders at a high level; now they are at the point of status quo from late 2017. We are not concerned yet, but there is certainly trepidation about the future.” (Machinery)

“NAFTA 2.0/USMCA does nothing to help our company, as it does not address Section 232 tariffs.” (Plastics & Rubber Products)

“Mounting pressure due to pending tariffs. Bracing for delays in material from China — a rush of orders trying to race tariff implementation is flooding shipping and customs.” (Miscellaneous Manufacturing)

“Orders and shipments are strong right now. Backlog for Q4 and next year are way down."

Markit is ebullient...

Chris Williamson, Chief Business Economist at IHS Markit said:

We suspect ISM is right on this one!!

When does the soft survey data catch down to tightening financial conditions?

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Or the 'hard' economic data?

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