In June 2023, the U.S. S&P Global Manufacturing PMI reached a six-month low of 46.3, indicating a continued decline in the manufacturing sector's health (in fact, the print came in lower for two consecutive months). This decline was primarily driven by a decrease in output and a significant downturn in new orders, resulting from weakened demand caused by inflationary pressure and higher interest rates. ISM Manufacturing PMI also dropped for a second consecutive month, falling from 46.9 in May 2023 to 46 in June 2023. Both of these indicators show signs of continued contraction. As a result, today, we will watch out for the data releases related to services. If services also show signs of contraction, the odds of recession will grow.