ISM Manufacturing Fails to Improve in September. Still in Positive Territory
A key index of nationwide manufacturing conditions remained positive for the second consecutive month in September, even though it failed to meet expectations for further improvement.
The ISM survey came in at 52.6, three-tenths lower than August’s score, but still indicating broad strength in the manufacturing sector.
“While the rate of growth moderated slightly when compared to August, the recovery broadened as the number of industries reporting growth increased from 11 to 13,” said Norbert Ore, chairman of the Institute for Supply Management’s survey committee.
New orders fell relative to August but continue to show robust strength with a 60.8 reading. Production is also lower but is still well above the 50-threshold indicating growth at 55.7. Employment was little changed, down 0.4 points to 46.2, which indicates contraction but not a total hemorrhaging of the jobs sector.
“Despite the unexpected drop in the headline index, it continues to point to further growth in U.S. manufacturing sector activity in September, though the pace of growth may have eased somewhat during the month,” said Millan Mulraine, strategist at TD Securities, who noted the month-to-month moderation was the first in 2009.
In a special question in this month's report, nearly one-third of firms said the the federal stimulus bill passed in February would help their industry.
“It appears the fundamentals for continuing recovery are still at work as inventories and sales are gaining balance,” Ore said.
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