From the Institute for Supply Management:
Economic activity in the manufacturing sector expanded in October for the fifth consecutive month, and the overall economy grew for the 53rd consecutive month, say the nation’s supply executives in the latest Manufacturing ISM Report On Business®.
… “The PMI™ registered 56.4 percent, an increase of 0.2 percentage point from September’s reading of 56.2 percent. The PMI™ has increased progressively each month since June, with October’s reading reflecting the highest PMI™ in 2013. The New Orders Index increased slightly in October by 0.1 percentage point to 60.6 percent, while the Production Index decreased by 1.8 percentage points to 60.8 percent. Both the New Orders and Production Indexes have registered above 60 percent for three consecutive months. The Employment Index registered 53.2 percent, a decrease of 2.2 percentage points compared to September’s reading of 55.4 percent. The panel’s comments are generally positive about the current business climate; however, there are mixed responses on whether the government shutdown and potential default have had any effect on October’s results.”
Of the 18 manufacturing industries, 14 are reporting growth in October …
It’s an unequivocally strong report. But …
Some of its results are inconsistent with hard data (e.g., employment rising for four straight months, when government stats show seasonally adjusted manufacturing employment flat since June and down 25,000 since February). This report also hasn’t been consistent with several regional PMIs which are nowhere nearly as positive and which have shown significant recent declines in their degree of positivity.
An obvious exception, though, is yesterday’s stellar October Chicago PMI, so I’ll hold my skeptical fire until the government’s October employment report comes out next week.