ISM index holding steady ahead of potential tax reform and rate hike

December 6, 2017

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By Bobby Bono and Mike Goulet

The Institute for Supply Management (ISM) Purchasing Manager’s Index (PMI) for manufacturing recorded a modest decline in November, dropping to 58.2 from 58.7 the previous month, a 0.5% decline. The small decline reflects a mix of positive and negative signals in the underlying data. Of the 18 manufacturing industries included in the index, 14 of them reported growth leading to a 2.9% increase in the Production Index (63.9 in November versus 61 in October.)

Meanwhile, the prices index dropped 3% reflecting continued commodity price increases, and supplier deliveries were down 4.9% leading to an increase in inventories of 2.0%. Employment, however, was flat at a 0.1% decline, perhaps reflecting general uncertainty ahead of potential tax reform and rate hike. In general, the ISM numbers reflected strong economic conditions heading into the end of the year.

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