US ISM manufacturing index rose to 55.3 in March, up from 54.2 and beat expectation of 54.3. Price paid component rose to 54.3, up from 49.4. Employment component jumped notably to 57.5, up from 52.3.
ISM noted that
- Comments from the panel reflect continued expanding business strength, supported by gains in new orders and employment.
- Demand expansion continued, with the New Orders Index returning to the high 50s, the Customers’ Inventories Index improving but remaining too low, and the Backlog of Orders Index softening to marginal expansion levels.
- Consumption (production and employment) continued to expand and regained its footing with a combined 6.2-percentage point gain from the previous month’s levels, recovering most of February’s loss.
- Inputs — expressed as supplier deliveries, inventories and imports — were lower this month, primarily due to inventory consumption exceeding inputs, resulting in a combined 2.3-point decline in the Supplier Deliveries and Inventories indexes that contributed negatively to the PMI.
- Imports expansion declined to near-zero expansion levels.
- Overall, inputs continue to reflect an easing business environment, but to a lesser extent than in February, confirmed by the Prices Index returning to expansion.
- Exports orders continue to expand, but at marginal levels.
- Prices reversed two months of contraction by returning to a robust mid-50s level.
- The manufacturing sector continues to expand, demonstrated by improvements in the PMI® three-month rolling average, which is consistent with overall manufacturing growth projections.
