February 2011 ISM Reports

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The pace of growth in manufacturing rose in Febuary, with the Institute for Supply Management’s (ISM) PMI ticking up by 0.6 percentage point. "February's report from the manufacturing sector indicates continuing strong performance as the PMI registered 61.4 percent, a level last achieved in May 2004,” said Norbert Ore, chair of ISM’s Manufacturing Business Survey Committee. "New orders and production, driven by strength in exports in particular, continue to drive the composite index. New orders are growing significantly faster than inventories, and the Customers' Inventories Index indicates supply chain inventories will require continuing replenishment. The Employment Index is above 60 percent for only the third time in the last decade. While there are many positive indicators, there is also concern as industries related to housing continue to struggle and the Prices Index indicates significant inflation of raw material costs across many commodities."

Both Wood and Paper Products showed signs of improvement once again, although those signs were quite sparse in the case of Wood Products.
 

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The non-manufacturing sector also grew slightly faster again in February, thanks to a 0.3 percentage point (to 59.7 percent) increase in the NMI. This time around, however, Real Estate was the only service industry among those we track to share in that expansion.

The rate of input price increases tamed somewhat in February. The prices-paid index rose a modest 0.5 percentage point for manufacturers, while non-manufacturers faced a 1.2 percentage point jump in their price index. Plywood, gasoline, diesel, energy, and paper and paper bags were among the relevant commodities up in price. No relevant commodity was down in price, neither was any relevant commodity described as in short supply.