Aug. 7, 2014
PMI Hits Highest Mark Since April 2011
Economic activity in the manufacturing sector expanded in July for the 14th consecutive month as the Institute for Supply Management's PMI registered 57.1 percent, an increase of 1.8 percentage points from June. July's reading was the highest in more than three years, since a 58.9 percent figure in April 2011. Any reading above 50 indicates growth.
ISM polls corporate purchasing managers each month. Of the 18 manufacturing industries surveyed, 17 reported growth in July, including fabricated metal products, machinery and miscellaneous manufacturing.
Many other indices also showed substantial gains in July. The New Orders Index registered 63.4 percent, an increase of 4.5 percentage points from June, indicating growth in new orders for the 14th consecutive month. The Production Index registered 61.2 percent, 1.2 percentage points above June. Employment grew for the 13th consecutive month, registering 58.2 percent, an increase of 5.4 percentage points.
The average PMI for January through July corresponds to a 3.7 percent increase in gross domestic product on an annualized basis, reports Bradley J. Holcomb, chairman of ISM's Manufacturing Business Survey Committee. If the PMI for July is annualized, it corresponds to a 4.6 percent increase in real GDP.