ISM manufacturing rises to the highest since 2022
- Prior 52.7
- Highest reading since May 2022
- New orders 56.8 vs 54.1 prior
- Production 54.3 vs 53.4 prior
- Employment 48.6 vs 46.4 prior
- Prices paid 82.1 vs 84.6 prior
- New export orders 50.6 vs 47.9 prior — back in expansion
This is a strong headline number and it's the fifth straight month of expansion, but I'd be careful about taking the victory lap at face value.
The internals are genuinely good. New orders accelerating to 56.8 is the part that matters most — that's the forward-looking piece, and it's running well clear of the contraction lows from earlier in the cycle. Export orders clawing back above 50 and customers' inventories sitting at a 'too low' 42.7 both point to a production tailwind into the summer. This is exactly the shape of report you want to see if you're constructive on the manufacturing cycle.
Prices paid is the index to watch here. It eased to 82.1 from 84.6, which technically counts as a 'good' move, but an 82-handle is still screaming cost pressure. With oil sensitive to the Iran headlines, the disinflation-on-prices-paid story is one bad weekend away from reversing.
Employment at 48.6 is still in contraction, and the report's own breakdown — half the panel holding head counts steady, half hiring — is not the labor backdrop of a sector firing on all cylinders. It's improving though.
Comments in the report:
- “Impact of Iran conflict starting to directly and negatively impact cost of supply chain. Oil and related commodities are escalating in price.” [Transportation Equipment]
- “The Middle East conflict is triggering shipment delays and uncertainties. Elevated gas prices and inflation will surely impact our purchases. However, over the last quarter, we’ve seen increased demand that was unexpected.” [Machinery]
- “As with all companies, we have felt the effects of fuel-related inflation and general market uncertainty due to overall economic variability and geopolitical events that have impacted such markets as construction, automotive and agriculture, as well as the general industrial sector.” [Chemical Products]
- “Continuing trends of 15-percent sales increase in April, cost increases on a majority of raw materials, and fuel charges on many inbound and outbound deliveries. We remain cautiously optimistic that if global economic factors stabilize and the Iran conflict ends, we can continue with increased sales and maintain acceptable margins.” [Chemical Products]
- “Cost of diesel is having huge impacts on our profitability. Confusion abounds around tariff refunds. We purchase many imported goods but in most cases are not the importer of record, so it is currently unclear to what we may be entitled.” [Food, Beverage & Tobacco Products]
- “Prices continue to rise for many products — some due to increase in data center creation for electronic components, others as a result of the Iran war and reductions in availability of oil/petroleum.” [Computer & Electronic Products]
- “Supply constraints continue to propagate and are a key headwind to supporting increased aerospace and defense demand. Semiconductors, critical minerals and certain types of raw materials are illustrative examples of sales plans at risk. Corporate risk mitigation actions are underway to secure supply in the midst of constraints.” [Transportation Equipment]
- “The current atmosphere is one of extreme uncertainty and concern for the future in terms of both price stability and longer-term supply continuity related to the Iran conflict and Strait of Hormuz closure. We have a lot of negotiations in process related to requested price increases, some related to oil prices and some still fallout from the 2025 tariff/geopolitical climate.” [Miscellaneous Manufacturing]
- “Continued dynamic random-access memory (DRAM) volatility, increased gas prices and tariffs are causing long lead constraints and price hikes that customers are not willing to bear. Panic is starting within our industry.” [Electrical Equipment, Appliances & Components]
- “Business appears to be weakening — uncertainty surrounding the Iran war, rising energy prices and customers unwilling to commit to expenditures beyond a very short term.” [Fabricated Metal Products]
Earlier, the S&P Global US PMI was revised slightly lower to 55.1 from 55.3 in the preliminary report. The prior was 54.5 so it was still month-to-month improvement.
Finally, April US construction spending rose 0.4%, better than the 0.2% consensus.
This article was written by Adam Button at investinglive.com.提供 MainLink：Investinglive RSS Breaking News Feed
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