December 1, 2005 – The ISM diffusion index of U.S. manufacturing activity (also known as the Purchasing Managers’ Index, or PMI) fell by 1 index point to 58.1 in November, but continued to signal exceptionally strong manufacturing growth for the third straight month (Chart 1).
According to the ISM press release, “While energy costs and supply interruptions remain a concern, purchasers are satisfied in general with current business conditions.”
Within the data detail, the new order index fell by 1.9 index points to 59.8 in November and the production index fell by 1.4 index points to 60.6, but both remained unusually buoyant even after these declines.
The input price index fell by 10 index points to 74.0 in November, but continued to signal exceptionally strong growth in manufacturers’ costs (Chart 2).
The employment index rose by 1.6 index points to 56.6 in November (Chart 3). This might be a bullish omen for November manufacturing payrolls (coming tomorrow), but the fate of non-manufacturing payrolls carries far more economic weight.