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Economy

Economic Data (USA)

Monday, October 01, 2018

ISM Manufacturing Index for September 2018

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

Predicted: 59.9%
Actual: 59.8% (-1.5 points | -2.45% M/M Change)

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Previous month: 61.3%

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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 June, and the overall economy grew for the 113th 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:



  •     'The market is in a state of chaos with the latest round of tariffs. As an electronics original equipment manufacturer, our component prices have been impacted almost across the board. The tariffs have caused a mass rush to buy up inventories of affected products in order to minimize the long-term financial impact. This, in turn, is causing market constraints, which further drive up the cost and increase lead times.'
     (Computer and Electronic Products)

  •     'Tariffs starting to take a bite out of profitability.'
     (Chemical Products)

  •     'Business is strong and relatively stable. Tariffs are putting pressure on Chinese imports. Labor rates are increasing as it is very difficult to find help.'
     (Furniture and Related Products)

  •     'The economy's strength is holding [and] outlook for the industry is positive, although continuing margin compression in consumer packaged goods is restricting general growth momentum from the greater economy.'
     (Food, Beverage and Tobacco Products)

  •     'Still extremely strong through November; starting to see a decline for steel prices for December.'
     (Fabricated Metal Products)

  •     'General available capacity at suppliers continues to decrease, creating supply issues.'
     (Machinery)

  •     'Tariffs are creating a drag on some of our export opportunities.'
     (Plastics and Rubber Products)

  •     'Sourcing hourly workers for remote locations continues to be a challenge for both full-time and part-time opportunities. Have implemented a wide variety of recruiting techniques and suppliers to aid us in sourcing this hard-to-find talent.'
     (Paper Products)

  •     'Orders are coming in, but from a limited number of customers. The future looks very promising.'
     (Primary Metals)

  •     'Suppliers are impacted by China tariffs, [which is] delaying or cancelling manufacturing transfer projects.'
     (Miscellaneous Manufacturing)


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ISM Manufacturing Index History - September 2018 Update
ISM Manufacturing Index History - September 2018 Update

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