TEMPE, AZ – US manufacturing grew in March for the eighth consecutive month, with the PMI registering 59.6%, up 3.1 percentage points, says the Institute for Supply Management.

A reading above 50% indicates the manufacturing economy is generally expanding.

New orders were up 2 points to 61.5%, while production was up 2.7 points to 61.1%. Inventories were 55.3%, rising sharply by 8 points. Customer inventories were 39%, up 2 points.

Backlogs dropped 3 points to 58%.

The rate of growth was the fastest since July 2004, ISM said in a press release.

“Both new orders and production rose above 60% this month, closing the first quarter with significant momentum going forward,” said ISM spokesperson Norbert J. Ore. “Although the employment index decreased 1 percentage point to 55.1% from February’s reading of 56.1%, signs for employment in the sector continue to improve, as the index registered a 10% month-over-month improvement, indicating that manufacturers are continuing to fill vacancies. The inventories index provided a surprise, as it indicated growth for the first time following 46 months of liquidation – perhaps signaling manufacturers’ willingness to increase inventories based on expected levels of activity.”

The overall economy grew for the 11th consecutive month, says ISM.

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