The manufacturing sector expanded in February, and the overall economy grew for the 93rd consecutive month, according to supply executives in the latest Manufacturing ISM Report on Business. The February PMI was 57.7 percent, an increase of 1.7 percentage points from the January reading.
The New Orders Index registered 65.1 percent, an increase of 4.7 percentage points from the seasonally adjusted January reading of 56 percent. The Production Index registered 62.9 percent, 1.5 percentage points higher than the seasonally adjusted January reading of 61.4 percent. The Employment Index registered 54.2 percent, an increase of 1.9 percentage points from the seasonally adjusted January reading of 56.1 percent. Inventories of raw materials registered 51.5 percent, an increase of 3 percentage points from the January reading of 48.5 percent. The Prices Index registered 68 percent in February, a decrease of 1 percentage point from the January reading of 69 percent, indicating higher raw materials prices for the 12th consecutive month.
A reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally contracting. The PMI, New Orders, Production and Employment Indexes all registered their highest levels since November of 2014, and comments from the panel are generally positive regarding demand levels and business conditions.
Of the 18 manufacturing industries, 17 reported growth in February in the following order: Textile Mills; Apparel, Leather & Allied Products; Machinery; Computer & Electronic Products; Primary Metals; Plastics & Rubber Products; Nonmetallic Mineral Products; Chemical Products; Paper Products; Fabricated Metal Products; Transportation Equipment; Food, Beverage & Tobacco Products; Wood Products; Electrical Equipment, Appliances & Components; Printing & Related Support Activities; Petroleum & Coal Products; and Miscellaneous Manufacturing. The only industry reporting contraction in February is Furniture & Related Products.
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