October’s 55.5 manufacturing PMI beats expectations

U.S. manufacturing activity remained in growth mode for a 10th straight month in October, with most key demand indicators remaining positive. The Monday update supported mostly positive demand commentary provided by public less-than-truckload carriers last week.

Manufacturing supply executives surveyed during the month returned a 55.5 reading for the Institute for Supply Management’s Manufacturing PMI. The report came in one percentage point ahead of analysts’ expectations and the September result. (A reading above 50 for the index signals expansion, while one below 50 indicates contraction.)

A sustained level above 47.5 signals that the overall economy is growing. The October reading was consistent with annualized real GDP growth of 2.7%, which was up from a 2.4% level in September, the report said.

The new orders index—an indicator of future activity—also expanded for a 10th straight month, logging a 55.5 reading, 20 basis points higher than September. Four of the six largest manufacturing industries tracked—machinery; computer and electronics; transportation equipment; and chemical products—reported increases.

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