TEMPE, Ariz. – U.S. manufacturing last month expanded for the third consecutive month, while the nation’s overall economy grew for the 66th month in a row, according to a report today from the Institute for Supply Management.
The ISM’s national Purchasing Managers Index rose in April to a 12-month high of 54.7 points, from March’s near-neutral 50.9, indicating the expansion is accelerating. (Readings higher than 50 indicate manufacturing is expanding; readings of 42 or higher indicate expansion in the overall economy.) The improvement was well above that anticipated by 77 economists surveyed by Bloomberg News, who forecast the PMI would edge up to 51.
“Orders were up and inventories were down, and that’s a good combination for economic growth going forward,” John Silvia, chief economist at Wachovia Corp. in Charlotte, N.C., told Bloomberg after reviewing the report. “There’s enough strength in the economy to get through the slow patch.”
“Manufacturing activity increased in April as the PMI reflects accelerating growth for the month,” Norbert J. Ore, chair of the ISM’s Manufacturing Business Survey Committee, wrote in today’s report. “New orders and production improved significantly, as did employment. Manufacturers are now in their ninth month of inventory reduction, so supply chains are generally in balance.
“On the negative side, prices continue to rise at a rapid rate, with metals and energy being the areas of greatest concern to buyers.”
The ISM’s index of manufacturers’ prices rose to an eight-month high of 73 points, from 65.5 points in March, exceeding the Bloomberg survey’s median forecast of 67.5 points.
Additional information is available at www.ism.ws.