The Lehmann
Letter (SM)
This morning’s
report from the Institute of Supply Management that its April Purchasing
Managers’ Index (PMI) rose slightly to 54.8 is good news:
But once
again we turn to our chart for perspective. Any reading over 50 is good because it shows that manufacturing is growing, and
you can see that the PMI has been above 50 since the recession. This indicates
that manufacturing continues to expand, but not at a robust rate.
Purchasing
Managers’ Index
(Click on
chart to enlarge)
(Recessions
shaded)
The PMI
reached toward 60 immediately after recession’s end as businesses restocked
their inventories. That jump in orders bumped the PMI upward. Then it settled
into a long, slow upward climb of readings just above 50.
Today’s
report is good, but not great. And that’s OK. The coming months will reveal
whether or not manufacturing has begun to grow more rapidly.
(To be fully
informed visit http://www.beyourowneconomist.com/)
© 2012
Michael B. Lehmann
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