Solid growth for manufacturing highlights an otherwise soft PMI flash
report for March. The manufacturing PMI came in at 55.7 which is right
at a 3-year high. But the report's service sample is showing volatility,
shooting suddenly higher in February and now falling back to a more
moderate 54.1. Together they make for a 54.3 composite score which is
down nearly 2 points from February.
Strength on the manufacturing
side includes orders, production and employment but price pressures are
perhaps the most telling result. A number of survey respondents cited
higher prices for metals and increased charges by suppliers amid strong
demand for raw materials. At the same time, selling prices rose at the
strongest pace in just over 6-1/2 years.
Despite the slowing on
the service side, orders and employment remain strong. And price
pressures are also evident. Today's results should firm expectations for
yet another sky-high reading in the ISM manufacturing report though
they may temper expectations for ISM's non-manufacturing data.
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