The Institute for Supply Management (ISM) released its Manufacturing Index for October. The reading of 59.0 compared to the Bloomberg consensus of 56.0. This was up from the reading of 56.6 in September. The ISM report stands out starkly from the net result of other anecdotal surveys on October’s manufacturing sector, showing outstanding growth.
The October reading matches the reading from August, making them the two the strongest ISM readings since February 2011.
New orders posted a strong gain of 5.8 points to 65.8. This is indicative of rising activity across the supply chain for the months ahead.
Export orders slowed in the month, as they did for Markit’s sample released early Monday morning. This slowing implies that domestic demand is especially strong. In a couple signs of strength, total backlog orders increased while supplier deliveries, reflecting ongoing congestion in the supply chain, slowed.
Production, which read at a strong 64.8, was in line with orders. October inventories showed slight accumulation over the course of the month. Price pressures moderated, as they have in most reports for October, as a result of lower oil prices.
Comments from the panel generally cited positive business conditions, with growth in demand and production volumes. Of the 18 manufacturing industries, 16 reported growth in the month of October. That being said, the only industry that reported contraction in October was petroleum and coal products.