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Manufacturing ends 2017 with another strong performance

PMI jumps to 59.7% in December and finishes the year up more than 15%.

Bob Vavra, Content Manager, CFE Media
01/03/2018

Image courtesy: Bob VavraManufacturing ended 2017 with a surge that matched the increase in retail spending at Christmas. The monthly PMI Index from the Institute for Supply Management (ISM) jumped 1.5 percentage points to 59.7% in December, reversing a small decline in the previous two months and tickling the 60.0% mark that would indicate growth 20% above the baseline average.

The New Orders Index jumped 5.4 percentage points in December to 69.4%, leading a series of indicators that pointed toward continued strength in the manufacturing sector.

“Comments from the panel reflect expanding business conditions, with new orders and production leading gains; employment expanding at a slower rate; order backlogs expanding at a faster rate; and export orders and imports continuing to grow in December,” said Timothy, Fiore, chairman of the ISM’s Manufacturing Business Survey Committee. “Supplier deliveries continued to slow (improving) at a faster rate, and inventories continued to contract at a slower rate during the period. Price increases continued at a faster rate.”

The comments from committee members reflected a general confidence about the health of the sector, and pointed toward a strong start to 2018. Among the comments:

The PMI’s December reading what the 16th straight month the index finished above the 50% threshold for growth, and was the seventh straight month the index topped 55%, indicating 10% growth for manufacturing. For the year, the PMI averaged more than 15% growth, with the average PMI coming in at 57.6%.

Bob Vavra is the content manager for Plant Engineering.

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