Tuesday, April 1, 2014

ISM Manufacturing Index Rose in March

The ISM manufacturing index made small gains in March, but was slightly below expectations. Due to the harsh weather negatively impacting the ISM reading in January, and somewhat in February, March was expected to experience a greater rebound. Nevertheless, the index rose 0.5 points to 53.7, well above the threshold of 50 that signifies expansionary territory. February’s reading is the 10th consecutive month the index has been in expansionary territory.

The details of the report were mainly positive. Production jumped a substantial 7.7 points to 55.9, and back into expansionary territory in March. This represents the largest month-over-month increase in production since June 2009.

New orders grew by 0.6 points to 55.1. Specifically backlogged orders jumped by 5.5 points to 57.5.

The employment index dropped to 51.1 in March, from 52.3 the month prior. Despite the lower rate, this is the ninth consecutive month of growth in employment.

Inventory growth remained the same in March, while new orders grew. The gap between inventories and new orders – a proxy for future production – rose to 2.6 points.

Read the ISM release.

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