Published: Wed, August 02, 2017
Business | By Max Garcia

ISM manufacturing index falls from three-year high

ISM manufacturing index falls from three-year high

The service sector index is expected to edge down to 56.9 in July from 57.4 in June.

"New export orders increased for the 11th consecutive month, but at the slowest rate since November previous year, and some panellists mentioned having expanded into new markets".

Export orders decreased 2.0 points to 57.5, indicating growth for the seventeenth consecutive month.

Economic activity in the manufacturing sector expanded in July at a slower pace than in June, according to the Institute for Supply Management's purchasing managers index for USA manufacturing.

Manufacturing PMI measures the performance of the manufacturing sector and is derived from a survey of 400 manufacturing companies.

The Manufacturing and Non-Manufacturing PMI Report on businesses is based on data compiled from purchasing and supply executives' responses. A reading above 50% indicates expansion and below 50% contraction.

However, it reported that the remaining five sub-sectors declined in the following order: Petroleum and coal products; fabricated metal products; furniture and related products; non-metallic mineral products and plastics and rubber products.

In Southeast Asia, Vietnam's PMI ranked second, after the Philippines whose index stood at 52.8 in July.

"The index at 59.3 points indicated an expansion in production at a faster rate, when compared to the level recorded in the previous month".

Rates of growth in output and employment eased during the month. According to the report, "The production level index for the manufacturing sector grew for the fifth consecutive month in July 2017".

"Comments from the panel generally reflect expanding business conditions, with new orders, production, employment, backlog and exports all growing in July compared to June, as well as supplier delivers slowing (improving) and inventories unchanged during the period", said the report.

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