Economic activity in the manufacturing sector expanded in February for the 19th consecutive month, and the overall economy grew for the 21st consecutive month, say the nation’s supply executives in the latest Manufacturing ISM Report On Business released Tuesday, March 1.
February’s report from the manufacturing sector indicates continuing strong performance as the PMI registered 61.4 percent, an increase of 0.6 percentage point when compared to January’s reading and the highest PMI reading since May 2004 when the index also registered 61.4 percent.
A reading above 50 percent indicates that the manufacturing economy generally is expanding; below 50 percent indicates that it generally is contracting. New orders and production, driven by strength in exports in particular, continue to drive the composite PMI index, says Norbert Ore, chair of the Institute for Supply Management Manufacturing Business Survey Committee.
“New orders are growing significantly faster than inventories, and the Customers’ Inventories Index indicates supply chain inventories will require continuing replenishment,” Ore says. Meanwhile, the Employment Index is above 60 percent for only the third time in the last decade.
“While there are many positive indicators, there is also concern as industries related to housing continue to struggle and the Prices Index indicates significant inflation of raw material costs across many commodities,” Ore says.
