Many Manufacturing Indexes Show Slower Growth

The Purchasing Managers Index (PMI) registered 52.4% in February, down 3% from 54.1% in January. However, as a PMI score above 50% indicates growth, the PMI is still expanding, but at a slower rate. Other manufacturing indexes which showed slower growth compared to the prior month include New Orders (54.9%, down almost 5% from 57.6%, Production (55.3%, down about 1% from 55.7%), Employment (53.2%, down 2% from 54.3%), and Backlog of Orders (52%, down 1% from 52.5%).

Prices Lead Manufacturing Indexes with Faster Growth

Several manufacturing indexes showed faster growth in February compared to January, led by Prices (61.5%, up 11% from 55.5%). Exports (59.5%, up 8% from 55.5%) and Imports (54%, up 3% from 52.5%) also grew at a faster rate. Supplier Deliveries moved from contraction to expansion (53.6%, up 9% from 49%).

Inventories Go in Wrong Direction

The two inventory-related manufacturing indexes both displayed poor performance in February. Customer Inventory increased its rate of contraction (46%, down 3% from 47.5%), while Inventories remained flat just below the growth line at 49.5%.

11 of 18 Manufacturing Industries Grow

Of the 18 manufacturing industries, 11 are reporting growth in February, in the following order: Apparel, Leather & Allied Products; Machinery; Primary Metals; Transportation Equipment; Petroleum & Coal Products; Fabricated Metal Products; Paper Products; Computer & Electronic Products; Food, Beverage & Tobacco Products; Miscellaneous Manufacturing; and Chemical Products. The four industries reporting contraction in February are: Furniture & Related Products; Nonmetallic Mineral Products; Plastics & Rubber Products; and Electrical Equipment, Appliances & Components.

Source: Institute for Supply Management