Monday, March 05, 2018

ISM Non-Manufacturing Index decreased to 59.5% in February

by Bill McBride on 3/05/2018 10:03:00 AM

The February ISM Non-manufacturing index was at 59.5%, down from 59.9% in January. The employment index decreased in February to 55.0%, from 61.6%. Note: Above 50 indicates expansion, below 50 contraction.

From the Institute for Supply Management: February 2018 Non-Manufacturing ISM Report On Business®

Economic activity in the non-manufacturing sector grew in February for the 97th consecutive month, say the nation’s purchasing and supply executives in the latest Non-Manufacturing ISM® Report On Business®.

The report was issued today by Anthony Nieves, CPSM, C.P.M., A.P.P., CFPM, Chair of the Institute for Supply Management® (ISM®) Non-Manufacturing Business Survey Committee: "The NMI® registered 59.5 percent, which is 0.4 percentage point lower than the January reading of 59.9 percent. This represents continued growth in the non-manufacturing sector at a slightly slower rate. The Non-Manufacturing Business Activity Index increased to 62.8 percent, 3 percentage points higher than the January reading of 59.8 percent, reflecting growth for the 103rd consecutive month, at a faster rate in February. The New Orders Index registered 64.8 percent, 2.1 percentage points higher than the reading of 62.7 percent in January. The Employment Index decreased 6.6 percentage points in February to 55 percent from the January reading of 61.6 percent. The Prices Index decreased by 0.9 percentage point from the January reading of 61.9 percent to 61 percent, indicating that prices increased in February for the 24th consecutive month. According to the NMI®, 16 non-manufacturing industries reported growth. The non-manufacturing sector reflected the second consecutive month of strong growth in February. The decrease in the Employment Index possibly prevented an even stronger reading for the NMI® composite index. The majority of respondents’ continue to be positive about business conditions and the economy."
emphasis added
ISM Non-Manufacturing Index Click on graph for larger image.

This graph shows the ISM non-manufacturing index (started in January 2008) and the ISM non-manufacturing employment diffusion index.

This suggests slightly slower expansion in February than in January.