US Manufacturing Activity Expands for First Time Since 2022
US factory activity expanded last month for the first time since 2022 as orders ramped up and production quickened, pointing to a brighter manufacturing outlook.
The Institute for Supply Management’s manufacturing gauge rose 1.7 points in January to 50.9, the highest since September 2022, according to data released Monday. Readings above 50 indicate growth.
A measure of new orders rose 3 points to 55.1, the strongest growth since May 2022. The fifth straight monthly increase in the index, which illustrates a pickup in demand, led producers to ratchet up output.
The ISM production gauge moved solidly into expansion territory, climbing 2.6 points to 52.5 -- the best reading since March. That in turn encouraged manufacturers to bolster headcounts somewhat. The factory employment index expanded last month, though barely, for the first time since May.
The survey suggests optimism is gradually building among factory managers in the wake of Donald Trump’s presidential election win. To be sure, the threats of tariffs, plodding overseas economies and a stronger US dollar risk tempering enthusiasm about a more favorable regulatory environment and pro-business fiscal policy.
Producers are also contending with elevated costs amid a healthy demand environment. The ISM’s gauge of prices paid rose by 2.4 points to 54.9, the highest since May.
Meanwhile, inventory levels at manufacturers shrank at a faster pace, indicating production growth may remain healthy in coming months.
Source : Bloomberg
