TEMPE, AZ -- Manufacturing failed to grow for the third consecutive month in April as the PMI registered 48.6%, flat with March.
 
The good news: Backlogs grew, breaking six consecutive months of decline, and new export orders showed continued strength. Customers inventories dropped. The Computer and Electronic Products sector reported growth in April.
 
A PMI reading above 50% indicates that the manufacturing economy is generally expanding.
 
The general economy appears to be growing, however, as a PMI over 41.1%, over a period of time, generally indicates expansion. The year-to-date PMI is 49.1%.
 
ISM spokesman Norbert Ore stated, "The past relationship between the PMI and the overall economy indicates that the average PMI for January through April corresponds to a 2.5% increase in real gross domestic product. In addition, if the PMI for April is annualized, it corresponds to a 2.4% increase in real GDP annually.
 
"The manufacturing sector failed to grow in April as the PMI fell below 50% for the third consecutive month, he added. "Manufacturers are in a situation where both new orders and production are slowly declining, but prices continue to rise at highly inflationary rates."
 
For the month, backlogs were up 4 points to 51.5%, customer inventories dropped 6 points to 45%, new orders were flat at 46.5%, and production ticked up to 49.1%.