Markit Manufacturing PMI: Highest in Over Three Years
The April US Manufacturing Purchasing Managers' Index conducted by Markit came in at 56.5, up from the 55.6 final March figure. Markit's Manufacturing PMI is a diffusion index: A reading above 50 indicates expansion in the sector; below 50 indicates contraction.
Here is an excerpt from Chris Williamson, Chief Business Economist at IHS Markit in their latest press release:
“April saw US manufacturers reporting the strongest monthly improvement in business conditions since September 2014. The surveysuggests the economy has started the second quarter on a solid footing and sends an encouraging signal for GDP growth to accelerate after the modest 2.3% rate of expansion seen in the first quarter.
“Warning lights are being flashed in relation to inflation, however, with factories reporting the strongest rise in prices for nearly seven years. Suppliers are hiking prices in response to surging demand, while tariffs and higher oil prices are also exerting upward pressure on costs. With the average price of goods leaving factories rising at the fastest rate since 2011, consumer price inflation looks set to accelerate.” [Press Release]
Here is a snapshot of the series since mid-2012.
Here is an overlay with the equivalent PMI survey conducted by the Institute for Supply Management (see our full article on this series here, note that ).
The next chart uses a three-month moving average of the two rather volatile series to facilitate our understanding of the current trend.