Tuesday, May 1, 2012

Manufacturing Improved Notably in April

The ISM-Manufacturing index jumped in April, rising from 53.4 to 54.8. Despite expectations for a small decline the index increased for the fifth consecutive month and remains at its highest level since June. April’s reading is well above the first quarter average of 53.3.

The details of the report improved from March as well, with strong gains in new orders, production and employment. The production index rose to 61.0, its highest level since March 2011.

New orders also experienced notable growth rising to 58.2 from 54.5. Moreover, the gap between new orders and inventories, a proxy for future production, widened from 4.5 to 9.7 in April, this is the largest the gap has been since March 2011. New export orders rebounded in April, offsetting a drop seen in March. Export orders have now risen in five of the past six months, which is stronger than expected given that GDP has fallen in the U.K., Spain, Italy, Germany, and Japan.

Read the report.

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