ISM shows faster factory growth as input-price pressure eases
October manufacturing PMI rose to 55.5, with stronger output but a slower pace of employment growth.
U.S. manufacturing expanded faster in October, according to the Institute for Supply Management's latest survey. Its manufacturing Purchasing Managers' Index rose to 55.5 from 54.5 in September, marking a tenth straight month of expansion.
The reading is above the 50 line separating expansion from contraction in this survey. It is an index of business conditions, not a statement that factory output increased by 55.5%.
Production strengthens, hiring growth slows
The production index rose to 59.0 from 56.7, while new orders edged up to 55.5 from 55.3. Employment remained in expansion territory at 52.4, down from 52.7.
That combination is more informative than the headline alone. Output growth accelerated, but the employment measure did not strengthen alongside it. A lower employment index above 50 means slower growth in the survey, not outright contraction.
Costs still rise, just less quickly
The prices index eased to 75.2 from 77.9. It remained well above 50, meaning input prices were still increasing overall. A lower reading does not mean manufacturers' costs fell.
This report is separate from October's final S&P Global manufacturing survey, published earlier Monday. The two surveys have different respondents and methods; their index levels should not be combined or treated as interchangeable.
The practical message is a split one: factory activity continued to grow, and ISM's cost gauge cooled, but it did not show costs returning to normal. The survey adds evidence about the balance between growth and price pressure without deciding the Federal Reserve's next move.
