The ISM Manufacturing report for the month of September came in significantly ahead of expectations, topping 60 for the first time in over 13 years.  While economists were forecasting the headline index to come in at a level of 58.1, the actual reading came in at 60.8.  Relative to expectations, September’s report was the strongest since October 2014, and on an absolute level, this month’s print was the highest since May 2014.

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Looking at the commentary of each month’s report helps to get an idea of what issues manufacturers face, and besides the short-term disruption caused by the hurricanes, one word that stands out is “strong.”

The table below shows the m/m and y/y changes in the headline ISM Manufacturing index and each of its subcomponents.  On a m/m basis, the only components that declined this month were Business Inventories and Imports.  On the upside, the biggest increases were in Prices Paid, Supplier Deliveries, and New Orders.  Year/year, Customer Inventories was the only component that declined.

In terms of Prices Paid, this month’s increase was notable as the 9.5 point increase brought that index up to its highest level since May 2011.

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