The Institute for Supply Management (ISM) manufacturing index (PMI) came in at a very strong 61.3% in August, indicating an acceleration in sector growth. The reading easily beat the 57.7 consensus forecast, which was computed from a 56.5 to 58.1 range.
“Comments from the panel reflect continued expanding business strength,” Timothy R. Fiore, Chair of the ISM Manufacturing Business Survey Committee. “Demand remains strong, with the New Orders Index at 60 percent or above for the 16th straight month, and the Customers’ Inventories Index remaining low.”
The New Orders Index came in at 65.1%, an increase of 4.9% from July, while the Production Index rose 4.8% to 63.3%. The Employment Index registered at 58.5%, a 2-point gain.
Of the 18 manufacturing industries, 16 reported growth in August. The two industries reporting contraction in August were Wood Products and Primary Metals.
“The Backlog of Orders Index continued to expand, at higher levels compared to the previous month,” Mr. Fiore added. “Consumption improved, with production and employment continuing to expand, at higher levels compared to July, despite shortages in labor and materials.”