Manufacturing activity in America continued to expand last month, according to two reports released this morning. First, the purchasing managers' manufacturing index (PMI) from IHS Markit rebounded in September to 55.6, the best print since May. Faster growth in production and new business were big factors behind last month’s PMI improvement, which surveyed managers attributed to more favorable demand conditions. Order backlogs also increased in September, and manufacturers continued to expand their staffs in an attempt to reduce capacity constraints.
Similarly, the Institute for Supply Management's manufacturing index ended September at 59.8. That was an expected decline from the 14-year high hit in August and still one of the best headline readings of the current business cycle. Under the hood, new orders declined last month but measures of production, employment, and inflation all improved. Comments from surveyed managers were generally positive in September, although many respondents continued to cite frustrations with recent U.S. trade policy. Chris Williamson, Markit’s chief business economist, added that “Worries about trade wars and tariffs continued to dominate, pushing business confidence in the outlook down to its lowest for a year.”
Sources: Econoday, IHS Markit, ISM
Post author: Charles Couch