The Institute for Supply Management (ISM) manufacturing index (PMI) came in at 57.7%, a slight easing but still indicative of solid sector growth.
“Comments from the panel reflect continued expanding business strength,” said Tim Flore, Chair of the ISM Manufacturing Business Survey Committee. “Demand remains moderately strong, with the New Orders Index easing to below 60 percent for the first time since April 2017, the Customers’ Inventories Index remaining low but improving, and the Backlog of Orders Index remaining steady.”
The New Orders Index came in at 57.4%, down from an overheated 61.8%. The Production Index came in at 59.9%, a 4-point decline from the September reading of 63.9%. The Employment Index clocked in at 56.8%, down from 58.8%.
“The expansion of new export orders softened, but five of six major industries contributed, up from two in September,” Mr. Fiore added. “Prices pressure continues, with the index returning above 70 percent. Overall, the manufacturing community continues to expand, but at the lowest level since April 2018.”
Of the 18 manufacturing industries, 13 reported growth in October, in the following order: Textile Mills; Electrical Equipment, Appliances & Components; Apparel, Leather & Allied Products; Plastics & Rubber Products; Food, Beverage & Tobacco Products; Computer & Electronic Products; Furniture & Related Products; Miscellaneous Manufacturing; Machinery; Transportation Equipment; Printing & Related Support Activities; Chemical Products; and Paper Products.
The Supplier Deliveries Index came in at 63.8%, down from the prior reading of 61.1%. The Inventories Index registered 50.7% and the Prices Index registered 71.6%, a 4.7-percentage point increase from the September reading of 66.9%. That indicates higher raw materials prices for the 32nd consecutive month.
The 4 industries reporting contraction in October are: Wood Products; Primary Metals; Nonmetallic Mineral Products; and Fabricated Metal Products.