TEMPE, AZ – Manufacturing expanded in December for the fifth consecutive month, according to an industry report released today.
 
The December purchasing managers index rose 2.3 points to 55.9%, says the Institute for Supply Management. A reading above 50% is considered a sign for future expansion.
 
The PMI reached its highest mark since April 2006, when it registered 56%.
 
New orders grew to 65.5%, up 5.2 percentage points, while production steadily increased 1.9 points to 61.8%.
 
Inventories were up 2.1 points to 43.4%, and customer inventories fell 2 points to 35%. Backlogs also dropped 2 points to 50%.

The overall economy grew for the eighth consecutive month, says ISM.
 
“This month's report is quite strong, as both the New Orders and Production Indexes are above 60%. The sector may be benefiting from an excessive destocking cycle, as indicated by the recent performance of the Customers' Inventories Index. Customers' inventories have been 'too low' for nine consecutive months, and this month's index is the lowest reading since the inception of the index in January 1997. Overall, the recovery in manufacturing is continuing, but there are still some industries mired in the downturn, as evidenced by the seven industries still in decline,” said ISM spokesperson Norbert J. Ore.

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