Economy: ISM Manufacturing Index for February 2018

Earlier today, the Institute for Supply Management® (ISM®) released their Manufacturing Purchasing Manager's Index (PMI®) for February 2018:

Predicted: 58.6%
Actual: 60.8%

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Previous month: 59.1

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Every month, the ISM surveys purchasing and supply executives at hundreds of companies across the country who are involved in manufacturing in some form. The resulting index is watched closely by academics, economists and investors because manufacturing accounts for about 12% of U.S. Gross Domestic Product (GDP).

The PMI is a reliable barometer of U.S. manufacturing: A PMI above 50% implies that U.S. manufacturing expanded during the month specified, while a reading below 50% implies that the made-in-the-USA sector contracted.

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From Today's Report:

"...Economic activity in the manufacturing sector expanded in February, and the overall economy grew for the 106th consecutive month, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®...."

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The following is a sampling of quotes from a diverse pool of U.S. manufacturers:

"Availability of electronic components, long lead times, allocations and constraints continue to wreak havoc in the purchasing cycle, with no end in sight at this time.”
(Computer and Electronic Products)

“Our business saw [an] increase in fourth quarter, and it continued in January 2018. CapEx purchase deliveries are moving out globally.”
(Chemical Products)

“Labor market continues to be tight for supply chain talent in the Southern California area. Overall economy is strong.”
(Transportation Equipment)

“Employment is one of our biggest challenges. No labor available.”
(Food, Beverage and Tobacco Products)

“Steel market is doing rather well. Everybody is out of what I need.”
(Fabricated Metal Products)

“It seems the tax break for business is making a difference. Customers are spending more for capital equipment.”
(Machinery)

“Hiring has picked up for direct-hire employees. Due to end-of-2017 performance and improvement in commodity price, there has been an increase in capital budget.”
(Petroleum and Coal Products)

“Business is very strong, and our lines are running at full capacity.”
(Plastics and Rubber Products)

“We expect to have a strong year in 2018. In expectation, we have added to our sales staff and plan on adding to our production staff.”
(Miscellaneous Manufacturing)

“The weakening U.S. dollar in relationship to the yuan is starting to impact importing cost. We are starting to see more supplier price increases.”
(Electrical Equipment, Appliances and Components)

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