Sept US ISM non-manufacturing index 52.6 vs 55.0 expected

Author: Adam Button | Category: News

Highlights from the service sector PMI from ISM

  • Three-year low
  • Prior was 56.4
  • Estimates ranged from 54.0 to 57.5

  •     prices paid 60.0  versus 58.2 last month
  •     new orders 53.7 versus 60.3  last month
  •     employment 50.4 versus 53.1  last month - lowest since Feb 2014
  •     backlog of orders 54.0 versus 49.0 last month
  •     inventory change 53.0 versus 55.0 last month
  •     inventory sentiment 58.0 versus 56.0 last month
  •     new export orders 52.0 versus 50.5 last month
  •     imports 49.0 versus 50.5 last month
  •     business activity 55.2 vs 61.5 last month
The comments in the report are somewhat upbeat:

  • "Tariffs are adding uncertainty to short-term pricing on certain commodities, but suppliers are finding alternate solutions. The bigger impacts appear to be on demand side, which is driving short-term favorability in certain domestic markets." (Accommodation & Food Services)
  • "Demand has been variable - up one month, down the next. I think customers are watching our input costs and buying ahead on the dips, to the extent that contracts allow." (Agriculture, Forestry, Fishing & Hunting)
  • "We are very busy right now [and] expect to be so for the next 12 months. We are still very shorthanded with qualified labor." (Construction)
  • "Gearing up for the fourth quarter of 2019. On track to end the year generally as anticipated, considering interest-rate changes, trade and tariff issues and other economic indicators and trends." (Finance & Insurance)
  • "We continue with low patient census, which affects our orders and revenue." (Health Care & Social Assistance)
  • "As employee cost [wages] are increasing in this better economy, it is getting harder to fight price increases on goods and services." (Information)
  • "Costs are going up, from labor to chemicals to metals." (Management of Companies & Support Services)
  • "While Chinese tariffs are understandable, they are impacting our supply chain decisions. We are actively pursuing alternate sources for our China-based production. At this point, we have not passed on tariff costs to our customers, but we are evaluating all options." (Other Services)
  • "Business continues to pick up as we quickly approach Q4. Week by week, we inch closer to a much-anticipated holiday retail season, which requires not only last-minute buys, but a push to fill open positions." (Retail Trade)

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