The Institute for Supply Management’s purchasing managers index for U.S. manufacturing decelerated to a reading of 50.1 in October, down from September’s reading of 50.2.
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The report also said the prices index inched up to 39.0 in October from 38.0 in the previous month, but the reading below 50 indicates lower raw materials prices for the 12th straight month. Thew new orders index read at 52.9%, an increase of 2.8 percentage points and the production index came in at 52.9% as well, marking a 1.1 percentage point increase month-over-month.
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An ISM manufacturing reading of 50.1 corresponds to economic growth of around 2.1% y/y, close to the actual reading of 2% in Q3. Employment declined, however, to 47.6 from 50.5, the first sub-50 reading since April. Expectations called for a reading of 50.1. The nine industries reporting contraction in October – listed in order – are: Apparel, Leather & Allied Products; Primary Metals; Petroleum & Coal Products; Plastics & Rubber Products; Electrical Equipment, Appliances & Components; Machinery; Transportation Equipment; Wood Products; and Computer & Electronic Products.
