Economic Watch: Manufacturing Firms, Construction Down as Personal Spending Jumps
Results from two surveys of the nation’s purchasing executives indicate manufacturing activity in the U.S. during May was nearly unchanged from the month before. Meanwhile, separate reports show construction spending eased, but consumer spending increased, resulting in hopes that the current quarter will be stronger for the overall economy than the previous one.
The Institute for Supply Management’s Purchasing Managers Index (PMI) registered 54.9%, up 0.1 of a percentage point from the month before, but slightly less than a consensus estimate from analysts of 55%.
This marked the 9th straight month of growth and the 96th consecutive month the manufacturing economy has expanded with a reading above 50%, according to the supply management organization.
The New Orders Index registered 59.5%, an increase of 2 percentage points from the April reading while the Production Index registered 57.1%, a decline of 1.5 percentage points from April. Of the 18 manufacturing industries, 15 reported growth in May.
While the overall May reading doesn’t look that strong “the details are very healthy,” said analysts at Econoday, with new orders coming in at a very strong rate while production was also strong with gains in import orders and employment, all indicating a “steady and impressive” report.
A similar survey from financial information services provider IHS Markit shows manufacturing activity in May fell slightly to an eight-month low.
Its final May U.S. Manufacturing Purchasing Manager’s Index fell to 52.7, the weakest reading since September, but above the 50 no-change value. A preliminary reading for May, released just over a week ago, had the index slightly lower at 52.5.
This latest reading pointed to a further growth slowdown from the 22-month high recorded in January of 55. Weaker new business growth and softer job creation helped to offset a marginally stronger upturn in production volumes, according to the report.
May data indicated that manufacturing …Read the rest of this story
