ISM index rises in January
Economic activity in the manufacturing sector expanded in January for the second straight month in January, according to the Institute for Supply Management’s composite index of manufacturing activity. The PMI rose 2.9 points from December to 53.1% in January. A reading above 50 generally indicates growth.
In addition to growth in the composite index, the new orders index rose 3.6 points to 53.3%, and the production index increased 1 point to 53.6%. Both readings are good indicators of near-term freight growth.
Manufacturing is starting out the year on a positive note, with all five of the PMI’s component indexes — new orders, production, employment, supplier deliveries and inventories — registering above 50 percent in January,” said Bradley Holcomb, chair of ISM’s Manufacturing Business Survey Committee.
Only four industries are reporting contraction in January: nonmetallic mineral products; computer & electronic products; wood products; and chemical products.
Another piece of good news: ISM recalculated its 2012 PMI readings in light of the U.S. Department of Commerce’s recently completed annual adjustment to seasonal factors. Turns out, November was the only month in which the PMI was below 50%.