The Institute for Supply Management (ISM) has reported that manufacturing expanded in August with a reading of 55.7%. This is up by 0.3 percentage points when compared to July's reading of 55.4%, and it is well above what Bloomberg had a consensus of 53.8%. It effectively matches the highest estimate, within one-tenth of a percent. What really stands out besides this simply beating estimates handily is that August was the highest overall PMI reading in 2013.
A reading above 50% indicates expansion in the manufacturing sector of the economy, while readings under 50% indicate that it is generally contracting. The ISM signaled growth in new orders, production and employment, while there was contraction in inventories and a slowing in supplier deliveries.
The overall economy grew for the 51st consecutive month. The ISM said:
The New Orders Index increased in August by 4.9 percentage points to 63.2 percent, and the Production Index decreased by 2.6 percentage points to 62.4 percent. The Employment Index registered 53.3 percent, a decrease of 1.1 percentage points compared to July's reading of 54.4 percent. The Prices Index registered 54 percent, increasing 5 percentage points from July, indicating that overall raw materials prices increased when compared to last month. Comments from the panel range from slow to improving business conditions depending upon the industry.
Some 15 of the 18 manufacturing industries showed growth, much better than normal. The only industry reporting contraction in August is Miscellaneous Manufacturing.
FULL ISM DATA
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