United States: Manufacturing activity unexpectedly decelerates in November
December 1, 2010
The ISM manufacturing index (PMI) decreased to 56.6% in November, from 56.9% in October. The figure surprised the market slightly on the downside as it had anticipated the PMI expanding a notch to 57.0%. At the current level, the index points to an expansion for the 16th consecutive month, thus confirming a slow but steady recovery in U.S. manufacturing activity. A reading above 50% indicates that the manufacturing sector is expanding, while a reading below 50% is indicative of a contraction. The downward slide over the previous month mainly reflected a deterioration in the production category, which plummeted 7.7 points between October and November. The decline was partially offset by a stronger performance in supplier deliveries, which climbed 6.0 points in the same period. New orders and employment dropped 2.3 and 0.2 points, respectively. However, the inventories component rose 2.8 points, compensating somewhat for the deterioration seen in the other categories. At the current level, all five sectors which make up the manufacturing index currently stand above the 50% threshold.