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| ISM May Manufacturing Data (#1) - Jun. 1, 2006 |
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Summary
Earlier this morning, the Institute for Supply Management reported a sizable decline during May in its index designed to measure the economy's manufacturing activity. The consensus estimate had been looking for a result approximately two points lower than April's 57.3 reading. The actual number came in almost three points lower. Meanwhile, the index's price component registered its third large increase in a row.
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* The Institute for Supply Management reported earlier today that its index designed to measure the economy's manufacturing activity ("PMI") fell to 54.4 in May, materially weaker than April's reading of 57.3.
* The May result was worse than a consensus estimate that had been looking for something around 55.7.
* In May of 2005, the PMI stood at 51.8, 2.6 points or 4.8% below the latest result. However, last May's reading not only was the low point for all of 2005, it also was the lowest reading since June of 2003's 50.5.
* For May of 2006, the prices-paid component rose to 77.0, an increase of 5.5 points or a sizable 7.7% from April's 71.5. Not only did this represent a level that is decidedly high by historical standards, it was the highest result since October 2004's 78.5.
* Over the last three months, the price component was up 14.5 points or 23.2%. Moreover, as of May, it stood 28.5 points or a very substantial 58.8% above its recent low, which was 48.5 and was set last July.
(NOTE: Overall index and sub-index readings above 50.0 indicate
expansion; readings below 50.0 indicate contraction.)
* Next Monday (6/5), ISM will release May results for its non-manufacturing (service-sector index). After these numbers are out, I will publish a detailed analysis of May results for both ISM indexes.
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