NEW YORK - The overall economy grew for the sixteenth straight time after seven months of contraction, while the manufacturing sector expanded for the thirteenth time after eighteenth months of contraction, the Institute for Supply Management reported this morning.
According to the ISM’s monthly report on business, the ISM index gained to 56.3 in August from 55.5 in July.
Economists polled by Thomson Reuters predicted the index would hold at 55.5.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion. A reading of 50 shows the sector was unchanged in the month.
“Manufacturing activity continued at a very positive rate in August as the PMI rose slightly when compared to July," said Norbert J. Ore, chair of the Institute of Supply Management's manufacturing business survey committee. “In terms of month-over-month improvement, the Production and Employment Indexes experienced the greatest gains, while new orders continued to grow but at a slightly slower rate. August represents the 13th consecutive month of growth in U.S. manufacturing.”
The closely watched prices paid index gained to 61.5 from 57.5. The employment index was at 60.4, up from 58.6 the prior month.
The production index increased to 59.9 from 57.0, the new orders index fell to 53.1 from 53.5; the supplier deliveries index slipped to 56.6 from 58.3; the export orders index decreased to 55.5 from 56.5; and the imports index rose to 56.5 from 52.5.
The inventories index climbed to 51.4 from 50.2; the customers’ inventories index grew to 43.5 from 39.0; and backlog of orders slipped to 54.5 from 54.5.
Respondents’ comments included:
“Still experiencing intermittent delays in electronic components due to capacity and raw materials.” (Electrical Equipment, Appliances & Components)
“International sales are especially strong. Domestic business is solid.” (Chemical Products)
“Orders and business still strong.” (Primary Metals)
“Order rate has slowed some. Supplier capacity in general seems to be improved.” (Machinery)
“Large customers reducing pull rates for production.” (Computer & Electronic Products)
