Global| Feb 01 2005ISM Factory Index Slipped
by:Tom Moeller
|in:Economy in Brief
Summary
The Institute of Supply Management reported that its Composite Index of activity in the manufacturing sector slipped last month to 56.4, the lowest level since September 2003. Consensus expectations had been for 56.9 and new seasonal [...]
The Institute of Supply Management reported that its Composite Index of activity in the manufacturing sector slipped last month to 56.4, the lowest level since September 2003. Consensus expectations had been for 56.9 and new seasonal adjustment factors led to revisions of prior months' levels.
During the last twenty years there has been a 69% correlation between the level of the Composite Index and the three month growth in factory sector industrial production.
The new orders component reversed all of the gains in the prior two months and fell 6.1 points to 56.5, the lowest level since June 2003. Conversely, the separate index of export orders ticked up 0.3 points to a near record high. A 2.4 point decline in the supplier delivery index additionally contributed to the composite index's drop.
Other composite index components rose with a 4.8 rise in the employment index recovering nearly all of recent months' declines. During the last twenty years there has been a 69% correlation between the level of the ISM Employment Index and the three month growth in factory sector employment. Production recovered some of the prior three months' decline and inventories were unchanged.
The prices paid index fell for the third straight month, down nineteen points from the high last April.
| ISM Manufacturing Survey | Jan | Dec | Jan '04 | 2004 | 2003 | 2002 |
|---|---|---|---|---|---|---|
| Composite Index | 56.4 | 57.3 | 62.8 | 60.5 | 53.3 | 52.4 |
| New Orders Index | 56.5 | 62.6 | 69.2 | 63.5 | 57.9 | 56.5 |
| Prices Paid Index (NSA) | 69.0 | 72.0 | 75.5 | 79.8 | 59.6 | 57.6 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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