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Economy in Brief
U.S. ADP Nonfarm Private Payroll Declines Moderate During May
Nonfarm private payrolls during May declined 2.760 million (-16.6% y/y)...
Even Larger Decline in U.S. Factory Orders and Shipments in April
A second large factory orders decline led by durable goods...
U.S. Mortgage Loan Applications Now Down 39% from Early March High
Mortgage applications decreased 3.9% in week ending May 29...
Euro Area Unemployment Rate Falls; Italy's Rate Hits a 12-Year Low!
The data from Europe are eye opening...
U.S. Light Vehicle Sales Recover in May
Car & light truck sales both rise...
by Tom Moeller February 5, 2020
The Composite Index of Nonmanufacturing Sector Activity from the Institute for Supply Management (ISM) increased to 55.5 during January from 54.9 in December, revised from 55.0. It was the highest level since August but remained below the high of 61.2 in September 2018. A reading of 55.0 had been expected in the Action Economics Forecast Survey. Readings above 50 indicate a rise in activity.
Haver constructs a Composite Index using this nonmanufacturing reading and the manufacturing series released on Monday. The figure rose to 55.0 from 54.1 in December. It also was the highest level since last August. During the last 15 years, there has been a 69% correlation between this index and the q/q change in real GDP.
The rise in the nonmanufacturing index reflected improvement in the Business Activity measure to 60.9, the highest level since February of last year. The New Orders index gained slightly. Working lower was the Supplier Delivery index to 51.7 (NSA), indicating faster delivery speeds. Also easing was the Employment index to 53.1, the lowest level since September.
The Prices index declined to 55.5 from 59.3. It was the lowest level since February of last year. Sixteen percent of respondents reported paying higher prices while five percent paid less.
The ISM figures are available in Haver's USECON database, with additional detail in the SURVEYS database. The expectations figure from Action Economics is in the AS1REPNA database.
| ISM Nonmanufacturing Survey (SA) | Jan | Dec | Nov | Jan'19 | 2019 | 2018 | 2017 |
|---|---|---|---|---|---|---|---|
| Composite Diffusion Index | 55.5 | 54.9 | 53.9 | 56.0 | 55.5 | 58.9 | 56.9 |
| Business Activity | 60.9 | 57.0 | 52.3 | 57.9 | 58.0 | 61.5 | 60.2 |
| New Orders | 56.2 | 55.3 | 56.7 | 59.1 | 57.5 | 61.4 | 59.3 |
| Employment | 53.1 | 54.8 | 54.9 | 56.4 | 54.9 | 56.9 | 55.1 |
| Supplier Deliveries (NSA) | 51.7 | 52.5 | 51.5 | 51.5 | 51.5 | 55.8 | 53.2 |
| Prices Index | 55.5 | 59.3 | 58.8 | 58.7 | 57.6 | 62.1 | 57.6 |
| ISM Manufacturing + Nonmanufacturing Composite (SA) | 55.0 | 54.1 | 53.2 | 55.9 | 55.0 | 58.9 | 57.0 |
