Recent Updates
- New Loans (Q1); Domestic Financial Assets Abroad (Mar); Korea: Trade by Commodity (Mar), Loans to Households & Enterprises (Feb); Pakistan: Trade by Commodity (Mar); Indonesia: Regional Gross Domestic Product (2017); India: Trade by Country by Commodity (Feb)
- Japan: ** Japan's consumption activity index rebased from 2010=100 to 2011=100.**
- Japan: Consumption Activity Index (Feb)
- more updates...
Economy in Brief
German PPI Accelerates
The German year-on-year PPI has generally been decelerating since early 2017...
U.S. Leading Economic Indicators Signal Continued Expansion
The Conference Board's Composite Index of Leading Economic Indicators increased 0.3% during March...
Philadelphia Fed Factory Conditions Improve; Prices Jump
The Philadelphia Fed reported that its General Factory Sector Business Conditions Index rose to 23.2 during April...
U.S. Initial Claims for Unemployment Insurance Are Little Changed
Initial unemployment insurance claims slipped to 232,000 (-6.1% y/y) during the week ended April 14...
U.K. Retail Sales Fall
U.K. GDP is expected to cool its jets when the first quarter GDP number is released...
by Tom Moeller March 5, 2008
The Business Activity Index for the non-manufacturing sector, from the Institute for Supply Management, last month improved somewhat to a reading of 50.8 from 41.9 in January. Consensus expectations had been for less of an improvement to 47.7.
Despite the rise in February, the index remained near its lowest since 2003. A level of 50 is the break even point between rising and falling activity in the service sector.
Since the series' inception in 1997 there has been a 44% correlation between the level of the Business Activity Index in the non-manufacturing sector and the Q/Q change in real GDP for the services and the construction sectors. The correlation of the factory sector ISM index with the change in real GDP less just services is a higher 57%, though over the last ten years it only has been 34%.
The new orders sub index rose m/m to a reading of 49.6 and made up a little more than half of its ten point decline during January.
Conversely, the employment sub index also rose but its 3.0 point rise to 46.9 made up less than half the January decline. That was to its lowest level since 2002. Since the series' inception in 1997 there has been a 56% correlation between the level of the ISM non-manufacturing employment index and the m/m change in payroll employment in the service producing plus the construction industries.
Pricing power again eased slightly m/m for the third month, however, the level of 67.9 remained well above that of the last two years. Since inception ten years ago, there has been a 60% correlation between the price index and the q/q change in the GDP services chain price index.
ISM surveys more than 370 purchasing managers in more than 62 industries including construction, law firms, hospitals, government and retailers. The non-manufacturing survey dates back to July 1997.
The Business Activity Index for the non-manufacturing sector reflects a question separate from the subgroups mentioned above. In contrast, the ISM manufacturing sector composite index is a weighted average of five components.
ISM Nonmanufacturing Survey | February | January | February '07 | 2007 | 2006 | 2005 |
---|---|---|---|---|---|---|
Business Activity Index | 50.8 | 41.9 | 54.9 | 56.0 | 58.0 | 60.2 |
Prices Index | 67.9 | 70.7 | 53.9 | 63.8 | 65.3 | 68.0 |