Forex News – ISM manufacturing index rises for 6th straight month in November
December 3, 2013 2:33 pm
The US manufacturing sector grew in November, lifting the Institute of Supply Management (ISM) manufacturing index for a 6th straight month from the low of the year in May.
The ISM survey showed that US manufacturing expansion quickened in November to 57.3 from 56.4 in October and beat a forecast of 55.2. This was the fastest pace of increase in 2-½ years since April 2011.
The ISM data is a gauge of sentiment among factory purchasing managers.
The manufacturing sector was surprisingly not affected by the US government shutdown. A big contributor to the increase in the index was an increase in US export orders as a result of signs of recovery in Europe. This was a good sign that US factories will be a source of strength for the economy heading into 2014.
According to a breakdown of the ISM survey, new orders and export demand jumped in November to the highest levels since April 2011. An index of production also rose and the group’s factory employment measure increased in November to the highest level since April 2012.
A recovery in the US housing sector has generated more demand for big-ticket goods such as furniture and appliances, also helping with the increase in the ISM index. An increase in construction spending was also a catalyst in the jump in ISM.
The ISM data had a positive effect on the US dollar immediately after its release.
Any strong economic data will be closely watched by the Federal Reserve as it decides on when to begin tapering stimulus.
The US manufacturing sector grew in November, lifting the Institute of Supply Management (ISM) manufacturing index for a 6th straight month from the low of the year in May.
The ISM survey showed that US manufacturing expansion quickened in November to 57.3 from 56.4 in October and beat a forecast of 55.2. This was the fastest pace of increase in 2-½ years since April 2011.
The ISM data is a gauge of sentiment among factory purchasing managers.
The manufacturing sector was surprisingly not affected by the US government shutdown. A big contributor to the increase in the index was an increase in US export orders as a result of signs of recovery in Europe. This was a good sign that US factories will be a source of strength for the economy heading into 2014.
According to a breakdown of the ISM survey, new orders and export demand jumped in November to the highest levels since April 2011. An index of production also rose and the group’s factory employment measure increased in November to the highest level since April 2012.
A recovery in the US housing sector has generated more demand for big-ticket goods such as furniture and appliances, also helping with the increase in the ISM index. An increase in construction spending was also a catalyst in the jump in ISM.
The ISM data had a positive effect on the US dollar immediately after its release.
Any strong economic data will be closely watched by the Federal Reserve as it decides on when to begin tapering stimulus.
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