The U.S. manufacturing sector expanded in February for the second straight month but only the third time in 40 months. The ISM Manufacturing PMI® registered 52.4% in February, a 0.2 percentage point (pp) decrease compared to the reading of 52.6% in January. The overall economy continued in expansion for the 16th month. (A Manufacturing PMI® above 47.5%, over a period of time, generally indicates an expansion of the overall economy.)
The Employment Index registered 48.8% in February, 0.7 pp higher than January’s reading of 48.1%. registered 70.5% in February, an increase of 11.5 pp over its January reading (59%) and indicating raw materials prices increased for the 17th straight month
New Orders Index expanded in January with a reading of 57.1%, an increase of 9.7 pp compared to December’s seasonally adjusted figure of 47.4% and the highest since it registered 59.7% in February 2022.
New Export Orders Index expanded in February with a reading of 55.8%, a decrease of 1.3 pp compared to January’s reading of 57.1%. Of the six largest manufacturing industries, four reported increases in new orders. A New Orders Index above 51.9%, over time, is generally consistent with an increase in the Census Bureau’s series on manufacturing orders.
Imports Index increased in February to 54.9%, a 4.9 pp increase compared to January’s reading of 50% and the highest since February 2022 (55.4%). Eight industries reported higher imports in February.
The Inventories Index registered 48.8% in February, up 1.2 pp compared to the reading of 47.6% in January. “Two of the six big industries expanded inventories in February,” says Spence.
Read the ISM release.
