Global| Apr 05 2004ISM Non-Manufacturing Index Set New High
by:Tom Moeller
|in:Economy in Brief
Summary
The Institute for Supply Management reported that the Business Activity Index for the non-manufacturing sector jumped to a new series' high of 65.8 in March. Consensus expectations had been for a more moderate gain to 61.5 versus 60.8 [...]
The Institute for Supply Management reported that the Business Activity Index for the non-manufacturing sector jumped to a new series' high of 65.8 in March. Consensus expectations had been for a more moderate gain to 61.5 versus 60.8 in February.
Since the series' inception in 1997 there has been a 41% correlation between the Business Activity Index and the q/q change in the GDP Service Sector Quantity Index.
The employment index improved to 53.9, the eighth month in nine above 50. Only 8% of firms reported lower employment in March, the series' low.
Since the series' inception in 1997 there has been a 62% correlation between the level of the ISM non-manufacturing employment index and the m/m change in payroll employment in the service producing and construction industries.
The new orders index improved to 62.8 versus 60.3 in February. These figures have varied in a range between 60 and 65 since last July.Business activity for the non-manufacturing sector is a question separate from the subgroups mentioned above. In contrast, the NAPM manufacturing sector composite index weights the components.
The seasonally adjusted prices index jumped to 65.7 from 57.3 in February. It was the third highest reading on record.
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 only to July 1997, therefore its seasonal adjustment should be viewed tentatively.
| ISM Nonmanufacturing Survey | Mar | Feb | Mar '03 | 2003 | 2002 | 2001 |
|---|---|---|---|---|---|---|
| Business Activity Index | 65.8 | 60.8 | 49.1 | 58.1 | 55.1 | 48.9 |
| Prices Index | 65.7 | 57.3 | 60.1 | 56.7 | 53.9 | 51.5 |
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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