Economy
ISM PMI Climbs 1.5 Points in December
Written by Sandy Williams
January 2, 2017
Economic activity in the manufacturing sector grew in December according to the latest Manufacturing ISM Report on Business. Growth in the overall economy expanded for the 91st consecutive month, said ISM.
The PMI for December reached 54.7, climbing 1.5 percentage points from November. The new orders index jumped 7.2 points to 60.2 from November and the production index grew 4.3 percent to register 60.3 Order backlogs remained at the same index reading as November and indicated contraction for a sixth month.
Employment remained relatively steady, increasing by 0.8 percent from November to 52.3.
Raw materials prices were higher for the tenth consecutive month, as indicated by an 11 point rise to a reading of 54.5 percent for December. Raw material inventories contracted in December for the eighteenth month. Customer inventories were considered too low for the third month in a row.
The new export orders index gained 4 percentage points indicating growth for the tenth month. The import index was unchanged from November but at 50.5 indicates a third consecutive month of growth.
Some of the comments by survey respondent are:
- “Ramping up for year-end by reducing inventory.” (Chemical Products)
- “We have been fairly steady the last few months and it appears business is strong into the 1st quarter of next year.” (Primary Metals)
- “Business continues to be brisk with an uptick of RFQs. Customers are earmarking funds for capital equipment upgrades.” (Machinery)
- “Hiring still tight on available local labor. Business, by segments, still uneven. Some consumer markets very (seasonally) strong, but industrial markets lagging.” (Transportation Equipment)
- “Business conditions are good, demand is growing.” (Miscellaneous Manufacturing)
- “December 2016 is way ahead of December 2015.” (Fabricated Metal Products)
Below is a graph showing the history of the ISM Manufacturing Index. You will need to view the graph on our website to use its interactive features, you can do so by clicking here. If you need assistance logging into or navigating the website, please contact our office at 800-432-3475 or info@SteelMarketUpdate.com.
Sandy Williams
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