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Tuesday, September 4, 2018

Manufacturing PMI Moderates, Still Solid Growth

Moderation at a still solid rate of growth is the indication from the manufacturing PMI which ended August at 54.7, up slightly from the mid-month reading of 54.5 but down noticeably from July's final at 55.3.

Growth in production was the slowest since November last year while growth in new orders slowed only slightly and helped keep backlogs and employment rising at a solid though slowing pace. A plus for new orders is that growth included an uptick in export sales.

Capacity stress is easing in PMI's sample as both growth in input costs and selling prices slowed to levels early in the year while lengthening in delivery times also eased. Business confidence is back on the climb, rising to a 3-month high.

Advance indications on August's factory sector are mixed to softer but rates of growth are still healthy. Similar results are expected for the ISM manufacturing report released later this morning at 10:00 a.m. ET.

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