Prior month 52.7manufacturing index 52.7 versus 53.0 estimate.Prices paid 84.6 versus 80.0 estimate and 78.3 last month.Employment index up 46.4 versus 49.0 estimate. Last month 48.7.New orders 54.1 versus 53.5 last month.Production 53.4 versus 55.1 last month.Supplier deliveries 60.6 versus 58.9 last month.Inventories 49.0 versus 47.1 last month.Backlog of orders 51.4 versus 54.4 last monthNew export orders 47.9 versus 49.9 last monthImports 50.3 versus 52.6 last month
Highlights:
The expansion above 50 was the 18th month in a row.New orders expanded for the 4th straight month which followed 4 straight month of contraction.Prices were disappointment with a 6.3% jump from March is reading. In the last 3 months price index has increased 25.6% to reach its highest level since April 2022.The employment index remains below the 50.0 level indicative of a contractionBacklog of orders registered fell by 3 percentage point but remains above the 50 level
Susan Spence, MBA, Chair of the Institute for Supply Management® (ISM®) Manufacturing Business Survey Committee.said:
“Manufacturing remained in expansion” but growth was steady, not accelerating overall
“New Orders and Supplier Deliveries improved”, signaling stronger demand and supply constraints
“Production slowed” while Employment and Inventories stayed in contraction
“Sentiment remains negative overall” with a 1 to 2.2 positive-to-negative ratio
“Iran war and tariffs are major themes”, mentioned in 47% and 18% of comments
“Demand is mixed” → New Orders and Backlogs expanding, but Backlogs declined
“Export demand remains weak” with New Export Orders still contracting
“Customer inventories are too low”, which is supportive for future production
“Production still expanding” (6th straight month) but losing momentum
“Employment remains weak” with firms focused on managing headcount, not hiring
“Layoffs and attrition are being used” to control labor costs
“Input conditions are mixed”
“Supplier delays are worsening”
“Prices surged sharply” to highest since April 2022 → strong inflation signal
“Imports softened”
“Manufacturing weakness increased slightly” (19% of GDP contracting vs 16%)
“Severe contraction eased” (share at ≤45 PMI fell to 2%)
“Major industries still expanding” (4 of top 6 sectors growing)
Employment weak/prices higher is not a good recipe. The Iran war and tariffs remain a big concerns yet despite those headwinds, new orders increased and the expansion is on its 18th month.
This article was written by Greg Michalowski at investinglive.com.