ISM: Manufacturing sector softens in November
December 3, 2012
Economic activity in the manufacturing sector contracted in November following two months of modest expansion, according to the Institute of Supply Managment’s latest Manufacturing ISM Report On Business. The PMI — ISM’s composite index of manufacturing activity — dropped 2.2 points from October to 49.5%. A reading below 50% generally indicates contraction.
Key components of the PMI, such as new orders and production, were more favorable for trucking. The new orders index dropped 3.9 points but remained in growth territory — barely — at 50.3%. And the production index actually rose 1.3 points to 53.7%. The new orders index in particular is an indicator of near-term freight shipment activity.
“Comments from the panel this month generally indicate that the second half of the year continues to show a slowdown in demand; respondents also express concern over how and when the fiscal cliff issue will be resolved,” said Bradley Holcomb, chair of ISM’s Manufacturing Business Survey Committee.
Of the 18 manufacturing industries, six are reporting growth in November in the following order: Petroleum & coal products; paper products; furniture & related products; electrical equipment, appliances & components; food, beverage & tobacco products; and computer & electronic products.
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