“The August PMI® is led by the highest recorded New Orders Index since April 2004 when it registered 67.1 percent. At the same time, comments from the panel reflect a positive outlook mixed with caution over global geopolitical unrest.”
The ISM PMI index for Manufacturing in the United States has been a good leading indicator for US GDP. We like to calibrate our Precision Machining Industry’s performance against it as well.
Our July PMPA Business Trends Report showed that our industry outperformed several FED manufacturing indicators. Our July Sales usually low because of summer shutdowns, vacations and retooling in Customer plants, were at the average for the Calendar year. today, ISM PMI shows that that positivity extending to August.
Today’s report from Institute for Supply Management showed the indicator rose 1.9 percent to 59 in August from 57.1 in July. This is a very optimistic reading, showing that the manufacturing economy expanded for the 15th consecutive month.
What does a bull sound like for prospects in manufacturing?
“This month’s PMI® reflects the highest reading since March 2011 when the index registered 59.1 percent. The New Orders Index registered 66.7 percent, an increase of 3.3 percentage points from the 63.4 percent reading in July, indicating growth in new orders for the 15th consecutive month. The Production Index registered 64.5 percent, 3.3 percentage points above the July reading of 61.2 percent. The Employment Index grew for the 14th consecutive month, registering 58.1 percent, a slight decrease of 0.1 percentage point below the July reading of 58.2 percent. Inventories of raw materials registered 52 percent, an increase of 3.5 percentage points from the July reading of 48.5 percent, indicating growth in inventories following one month of contraction. The August PMI® is led by the highest recorded New Orders Index since April 2004 when it registered 67.1 percent. At the same time, comments from the panel reflect a positive outlook mixed with caution over global geopolitical unrest.” -Bradley J Holcomb, Chair of the Institute for Supply Management® (ISM®) Manufacturing Business Survey Committee.
PMPA Business Trends data for July has also painted a picture of stronger than seasonally expected performance. We can hardly wit to see how the PMI August Data compares to our industry performance.
Graph courtesy Calculated Risk Blog
Street art courtesy REDBOY at Street and Stage Blog