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PMI® at 57.2%; March Manufacturing ISM® Report On Business®; New Orders, Production and Employment Growing; Supplier Deliveries Slowing; Inventories ContractingTEMPE, Ariz., April 3, 2017 /PRNewswire/ -- Economic activity in the manufacturing sector expanded in March, and the overall economy grew for the 94th consecutive month, say the nation's supply executives in the latest Manufacturing ISM® Report On Business®. The report was issued today by Bradley J. Holcomb, CPSM, CPSD, Chair of the Institute for Supply Management® (ISM®) Manufacturing Business Survey Committee: "The March PMI® registered 57.2 percent, a decrease of 0.5 percentage point from the February reading of 57.7 percent. The New Orders Index registered 64.5 percent, a decrease of 0.6 percentage point from the February reading of 65.1 percent. The Production Index registered 57.6 percent, 5.3 percentage points lower than the February reading of 62.9 percent. The Employment Index registered 58.9 percent, an increase of 4.7 percentage points from the February reading of 54.2 percent. Inventories of raw materials registered 49 percent, a decrease of 2.5 percentage points from the February reading of 51.5 percent. The Prices Index registered 70.5 percent in March, an increase of 2.5 percentage points from the February reading of 68 percent, indicating higher raw materials prices for the 13th consecutive month. Consistent with generally positive comments from the panel, all 18 industries reported growth in new orders for the month of March." Of the 18 manufacturing industries, 17 reported growth in March in the following order: Electrical Equipment, Appliances & Components; Printing & Related Support Activities; Furniture & Related Products; Textile Mills; Machinery; Primary Metals; Miscellaneous Manufacturing; Wood Products; Nonmetallic Mineral Products; Plastics & Rubber Products; Paper Products; Transportation Equipment; Chemical Products; Computer & Electronic Products; Food, Beverage & Tobacco Products; Fabricated Metal Products; and Petroleum & Coal Products. No industry reported contraction in March compared to February. WHAT RESPONDENTS ARE SAYING …
Manufacturing ISM® Report On Business® data is seasonally adjusted for the New Orders, Production, Employment and Supplier Deliveries Indexes. COMMODITIES REPORTED UP/DOWN IN PRICE AND IN SHORT SUPPLY Commodities Up in Price Commodities Down in Price Commodities in Short Supply Note: The number of consecutive months the commodity is listed is indicated after each item. MARCH 2017 MANUFACTURING INDEX SUMMARIES PMI® A PMI® above 43.3 percent, over a period of time, generally indicates an expansion of the overall economy. Therefore, the March PMI® indicates growth for the 94th consecutive month in the overall economy and the seventh straight month of growth in the manufacturing sector. Holcomb stated, "The past relationship between the PMI® and the overall economy indicates that the average PMI® for January through March (57 percent) corresponds to a 4.3 percent increase in real gross domestic product (GDP) on an annualized basis. In addition, if the PMI® for March (57.2 percent) is annualized, it corresponds to a 4.4 percent increase in real GDP annually." THE LAST 12 MONTHS
New Orders All 18 industries reported growth in new orders in March, listed in the following order: Wood Products; Printing & Related Support Activities; Electrical Equipment, Appliances & Components; Apparel, Leather & Allied Products; Paper Products; Plastics & Rubber Products; Primary Metals; Furniture & Related Products; Machinery; Nonmetallic Mineral Products; Transportation Equipment; Miscellaneous Manufacturing; Textile Mills; Chemical Products; Computer & Electronic Products; Fabricated Metal Products; Petroleum & Coal Products; and Food, Beverage & Tobacco Products.
Production The 17 industries reporting growth in production during the month of March — listed in order — are: Textile Mills; Apparel, Leather & Allied Products; Electrical Equipment, Appliances & Components; Furniture & Related Products; Miscellaneous Manufacturing; Machinery; Printing & Related Support Activities; Nonmetallic Mineral Products; Fabricated Metal Products; Primary Metals; Transportation Equipment; Chemical Products; Petroleum & Coal Products; Plastics & Rubber Products; Paper Products; Food, Beverage & Tobacco Products; and Computer & Electronic Products. No industry reported a decrease in March compared to February.
Employment Of the 18 manufacturing industries, the 14 reporting employment growth in March — listed in order — are: Electrical Equipment, Appliances & Components; Printing & Related Support Activities; Furniture & Related Products; Nonmetallic Mineral Products; Primary Metals; Paper Products; Machinery; Transportation Equipment; Food, Beverage & Tobacco Products; Computer & Electronic Products; Plastics & Rubber Products; Fabricated Metal Products; Miscellaneous Manufacturing; and Chemical Products. The three industries reporting a decrease in employment in March are: Apparel, Leather & Allied Products; Petroleum & Coal Products; and Textile Mills.
Supplier Deliveries The 12 industries reporting slower supplier deliveries in March — listed in order — are: Textile Mills; Machinery; Electrical Equipment, Appliances & Components; Food, Beverage & Tobacco Products; Chemical Products; Petroleum & Coal Products; Nonmetallic Mineral Products; Plastics & Rubber Products; Computer & Electronic Products; Miscellaneous Manufacturing; Transportation Equipment; and Fabricated Metal Products. Six industries reported no change in supplier deliveries in March compared to February. No industry reported faster supplier deliveries in March compared to February.
Inventories* The eight industries reporting higher inventories in March — listed in order — are: Textile Mills; Furniture & Related Products; Printing & Related Support Activities; Electrical Equipment, Appliances & Components; Primary Metals; Miscellaneous Manufacturing; Food, Beverage & Tobacco Products; and Computer & Electronic Products. The six industries reporting lower inventories in March — listed in order — are: Apparel, Leather & Allied Products; Fabricated Metal Products; Nonmetallic Mineral Products; Transportation Equipment; Chemical Products; and Machinery.
Customers' Inventories* The two manufacturing industries reporting customers' inventories as being too high during the month of March are: Primary Metals; and Transportation Equipment. The nine industries reporting customers' inventories as too low during March — listed in order — are: Textile Mills; Apparel, Leather & Allied Products; Plastics & Rubber Products; Paper Products; Chemical Products; Machinery; Fabricated Metal Products; Food, Beverage & Tobacco Products; and Computer & Electronic Products. Six industries reported no change in customer inventories in March compared to February.
Prices* Of the 18 manufacturing industries, the 16 that reported paying increased prices for its raw materials in March — listed in order — are: Apparel, Leather & Allied Products; Plastics & Rubber Products; Electrical Equipment, Appliances & Components; Textile Mills; Fabricated Metal Products; Primary Metals; Paper Products; Chemical Products; Machinery; Miscellaneous Manufacturing; Food, Beverage & Tobacco Products; Nonmetallic Mineral Products; Transportation Equipment; Furniture & Related Products; Computer & Electronic Products; and Petroleum & Coal Products. No industry reported paying lower prices during the month of March compared to February.
Backlog of Orders* The 13 industries reporting growth in order backlogs in March — listed in order — are: Textile Mills; Wood Products; Furniture & Related Products; Electrical Equipment, Appliances & Components; Plastics & Rubber Products; Transportation Equipment; Machinery; Nonmetallic Mineral Products; Paper Products; Computer & Electronic Products; Chemical Products; Fabricated Metal Products; and Primary Metals. The only industry reporting a decrease in order backlogs during March is Miscellaneous Manufacturing.
New Export Orders* The 11 industries reporting growth in new export orders in March — listed in order — are: Wood Products; Furniture & Related Products; Transportation Equipment; Chemical Products; Paper Products; Computer & Electronic Products; Electrical Equipment, Appliances & Components; Food, Beverage & Tobacco Products; Fabricated Metal Products; Machinery; and Miscellaneous Manufacturing. The only industry reporting a decrease in new export orders during March is Plastics & Rubber Products. Six industries reported no change in new export orders in March compared to February.
Imports* The 10 industries reporting growth in imports during the month of March — listed in order — are: Textile Mills; Paper Products; Furniture & Related Products; Fabricated Metal Products; Nonmetallic Mineral Products; Electrical Equipment, Appliances & Components; Chemical Products; Transportation Equipment; Miscellaneous Manufacturing; and Computer & Electronic Products. The four industries reporting a decrease in imports during March are: Apparel, Leather & Allied Products; Plastics & Rubber Products; Machinery; and Food, Beverage & Tobacco Products.
* The Inventories, Customers' Inventories, Prices, Backlog of Orders, New Export Orders and Imports Indexes do not meet the accepted criteria for seasonal adjustments. Buying Policy
About This Report The data presented herein is obtained from a survey of manufacturing supply executives based on information they have collected within their respective organizations. ISM® makes no representation, other than that stated within this release, regarding the individual company data collection procedures. The data should be compared to all other economic data sources when used in decision-making. Data and Method of Presentation Survey responses reflect the change, if any, in the current month compared to the previous month. For each of the indicators measured (New Orders, Backlog of Orders, New Export Orders, Imports, Production, Supplier Deliveries, Inventories, Customers' Inventories, Employment and Prices), this report shows the percentage reporting each response, the net difference between the number of responses in the positive economic direction (higher, better and slower for Supplier Deliveries) and the negative economic direction (lower, worse and faster for Supplier Deliveries), and the diffusion index. Responses are raw data and are never changed. The diffusion index includes the percent of positive responses plus one-half of those responding the same (considered positive). The resulting single index number for those meeting the criteria for seasonal adjustments (PMI®, New Orders, Production, Employment and Supplier Deliveries) is then seasonally adjusted to allow for the effects of repetitive intra-year variations resulting primarily from normal differences in weather conditions, various institutional arrangements, and differences attributable to non-moveable holidays. All seasonal adjustment factors are subject annually to relatively minor changes when conditions warrant them. The PMI® is a composite index based on the diffusion indexes of five of the indexes with equal weights: New Orders (seasonally adjusted), Production (seasonally adjusted), Employment (seasonally adjusted), Supplier Deliveries (seasonally adjusted), and Inventories. Diffusion indexes have the properties of leading indicators and are convenient summary measures showing the prevailing direction of change and the scope of change. A PMI® reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally declining. A PMI® above 43.3 percent, over a period of time, indicates that the overall economy, or gross domestic product (GDP), is generally expanding; below 43.3 percent, it is generally declining. The distance from 50 percent or 43.3 percent is indicative of the strength of the expansion or decline. With some of the indicators within this report, ISM® has indicated the departure point between expansion and decline of comparable government series, as determined by regression analysis. The Manufacturing ISM® Report On Business® survey is sent out to Manufacturing Business Survey Committee respondents the first part of each month. Respondents are asked to ONLY report on information for the current month. ISM® receives survey responses throughout most of any given month, with the majority of respondents generally waiting until late in the month to submit responses in order to give the most accurate picture of current business activity. ISM® then compiles the report for release on the first business day of the following month. The industries reporting growth, as indicated in the Manufacturing ISM® Report On Business® monthly report, are listed in the order of most growth to least growth. For the industries reporting contraction or decreases, those are listed in the order of the highest level of contraction/decrease to the least level of contraction/decrease. Responses to Buying Policy reflect the percent reporting the current month's lead time, the approximate weighted number of days ahead for which commitments are made for Capital Expenditures; Production Materials; and Maintenance, Repair and Operating (MRO) Supplies, expressed as hand-to-mouth (five days), 30 days, 60 days, 90 days, six months (180 days), a year or more (360 days), and the weighted average number of days. These responses are raw data, never revised, and not seasonally adjusted since there is no significant seasonal pattern. ISM ROB Content Except as explicitly and expressly permitted by ISM, you are strictly prohibited from creating works or materials (including but not limited to tables, charts, datastreams, timeseries variables, fonts, icons, link buttons, wallpaper, desktop themes, on-line postcards, montages, mash-ups and similar videos, greeting cards, and unlicensed merchandise) that derive from or are based on the ISM ROB Content. 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About Institute for Supply Management® The full text version of the Manufacturing ISM® Report On Business® is posted on ISM®'s website at www.ismrob.org on the first business day* of every month after 10:00 a.m. (ET). The next Manufacturing ISM® Report On Business® featuring the April 2017 data will be released at 10:00 a.m. (ET) on Monday, May 1, 2017. *Unless the NYSE is closed.
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