U.S. ISM Manufacturing PMI Improves in September
by:Tom Moeller
|in:Economy in Brief
Summary
- Index increases to highest level since November.
- New orders, production & employment rise.
- Prices index weakens.
The Purchasing Managers Index increased to 49.0 in September from 47.6 in August and 46.4 in July, according to the Institute for Supply Management. The latest figure was increased from a June low of 46.0. Remaining below 50, the figure indicated contraction in the U.S. manufacturing sector for the 11th successive month, though the rate of decline has eased. A September reading of 47.8 had been expected in the Action Economics Forecast Survey.
The new orders index rose to 49.2 last month from 46.8 in August. It was the highest level since August of last year and up from a January low of 42.5. Nineteen percent (NSA) of survey participants reported higher new orders while 22.3% reported a decline. The production index rose to 52.5 from 50.0. It was the highest level since July of last year. Twenty-two percent of respondents reported higher production while 18.5% reported a decline. The employment reading increased to 51.2 from 48.5, up from a July low of 44.4. Fifteen percent of respondents reported more jobs while 16.4% reported a decline.
In other components of the overall index, the inventory index moved up to 45.8 in September from 44.0 in August. It was the highest level in three months, but the vendor delivery series fell to 46.4 from 48.6. It remained up from a May low of 43.5.
Amongst other series, the prices index declined to 43.8 (NSA) last month from 48.4 in August. It was the lowest level in two months. Thirteen percent of respondents reported higher prices while 25.4% reported lower prices. The export series rose to 47.4 in September from 46.5 in August. It was the highest level in four months. The imports series improved to 48.2 from 48.0, but remained below 49.6 in July. The order backlog series fell to 42.4 from 44.1 in August. The index hit a low of 37.5 in May.
The ISM figures are based on responses from over 400 manufacturing purchasing executives from 20 industries, which correspond to their contribution to GDP in 50 states.
These data are diffusion indexes where a reading above 50 indicates expansion. The figures from the Institute for Supply Management can be found in Haver's USECON database; further detail is found in the SURVEYS database. The expectations number is available in Haver's AS1REPNA database.
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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