Investors hoping that this month’s less-than-stellar employment report would weaken the dollar while driving up demand for U.S. agricultural and industrial products — and boost the stock prices of the companies that make them — shouldn’t get too optimistic.

Although the U.S. economy came far short in adding jobs in September — recording 142,000 new jobs when economists had expected 200,000 — the value of the greenback dropped only about 2 percent in the two weeks that followed the Oct. 2 report.

While a weakened dollar generally improves demand for U.S. industrial goods as it increases purchasing power for overseas buyers, the fragile global economy, spurred by economic deceleration in China, is offsetting any gains from a weaker buck, analysts say.

“Global trade and emerging market economic issues will trump any kind of move in the U.S. dollar,” says Chad Morganlander, a portfolio manager at Stifel Nicolaus in Florham Park, New Jersey, which oversees about $170 billion in assets. “We are concerned that global trade will decelerate over the course of the next 12 months — not go negative, but decelerate — because of lackluster emerging market growth.”

The Federal Reserve has resisted raising its benchmark interest rate, which has been at 0.25 percent for almost seven years, as jobless numbers and other economic indicators show the U.S. economy isn’t rebounding at the speed many had hoped. In that time, the dollar has bounced around, but in the past year it’s gained more than 10 percent against a basket of six currencies including the yen and euro.

Commodities prices suffer. A stronger currency tends to be bad for demand as it reduces purchasing power for overseas buyers. Accordingly, the strong greenback has put a dent in demand for U.S. commodities and products that are used in agriculture production, construction and mining, says Jeffrey Sica, president of Sica Wealth Management in Morristown, New Jersey. Raising interest rates would further reduce trading partners’ ability to procure U.S. goods, he says.

Some governments may be pressuring the Fed to keep rates low, says Sica, who believes the Fed doesn’t have any plan, nor did it ever, to raise interest rates.

“They float out these test balloons and get backlash from all around the world,” he says. “The biggest fear is that we’ll raise interest rates and we’ll go back into stagflation environment. When you see the fragile fundamentals that the global economy is relying on, it kind of makes sense these countries don’t want the U.S. to raise interest rates.”

Certainly, demand from other countries for everything from soybeans and wheat to tractors and bulldozers is threatened as the global economy slows.

Slowing growth in China. The World Bank earlier this month lowered its projections for economic growth in China, saying the world’s second-largest economy will grow by 6.7 percent in 2016 and 6.5 percent in 2017. That’s down from projections for 7 percent and 6.9 percent, respectively.

As Beijing’s economy cools, so will demand for industrial metals, agricultural commodities and any construction equipment it may purchase.

Investments also will decelerate in China, thanks to tighter credit and “more subdued property sector conditions,” the World Bank said in an Oct. 4 report. “The shift from capital- and resource-intensive manufacturing to services will continue, facilitated by policies to reduce excess industrial capacity and ease business regulations in the services sector.”

Some analysts believe the slowdown is cyclical, and therefore, nothing to worry about. Morganlander, the Stifel analyst, isn’t so sure. He believes it may be a structural issue and will have a profound effect on not just Chinese demand for industrial goods, but also demand for U.S. products in the Asian country’s trading partners.

“I believe this deceleration growth in emerging markets is not cyclical and rather structural, and that will have broader implications to the U.S. in the next 24 months,” Morganlander says.

While China doesn’t purchase a lot of heavy machinery directly from the U.S., its trading partners do. Australia imports mining equipment, and South American countries purchase agricultural machinery.

Brazil, for example, among the largest exporters of agricultural products, will buy fewer tractors, combines and bulldozers from U.S. companies if China cuts back on purchases of soybeans.

Equipment manufacturers are feeling the pinch. Ted Grace, senior U.S. industrials analyst at Susquehanna Financial Group in Boston, says for companies that build industrial equipment, “the risks are increasingly to the downside” next year.

“It’s slowing global growth — the IMF and the World Bank have cut their forecasts, pretty much consistently with the way Wall Street … and global economists have,” he says. “Universally, forecasts have gone south.”

It’s not just the dollar and slowing economies — declining commodity prices and a large existing supply of heavy machinery in several countries also will give pause to business owners considering purchasing new equipment.

“We have all this equipment that’s been sitting around for years and has been underutilized,” Grace says. “Looking at China, they built up this massive stock of equipment in the past 10 years. Europe is similar — they have a lot of equipment from the last bubble, so it’s a similar dynamic. There will always be replacements, but it’s going to be pretty modest.”

The Standard & Poor’s GSCI Industrial Metals index has fallen 20 percent in the past year, while its agricultural index has declined 10 percent. “The mining economy is tough, given where commodity prices are,” Grace says. “It’s a really tough backdrop” for equipment manufacturers.

More from U.S. News

How to Build a Fidelity Portfolio With ETFs

10 Investing Tips for the Rest of 2015

7 Questions Investors Should Ask About Stock Earnings Estimates

Why Global Markets Want the Fed to Leave Interest Rates Alone originally appeared on usnews.com