Dr. Ed’s
Economic
Indicators

ISM MANUFACTURING INDEX

Release Date: First Business Day of the Month
Release Coverage: Surveyed Results
Released By: Institute for Supply Management (ISM)
Official Release: http://www.ism.ws/ISMReport/

The ISM manufacturing index provides a timely review of the current situation within the manufacturing sector. The index surveys thousands of companies, in a variety of industries, within the manufacturing sector.

As stated by the ISM's website – "The ISM manufacturing index is published monthly by the Institute for Supply Management™. Each month, the report is compiled from responses to questions asked of purchasing and supply executives across the country and reflects change, if any, in the current month compared to previous months. As the oldest and largest supply management institute in the world, the mission of the Institute for Supply Management™ is to lead supply management. By executing and extending its mission through education, research, standards of excellence, influence building and information dissemination — including the renowned monthly ISM Report On Business® report — ISM continues to extend the global impact of supply management. ISM's membership base includes more than 40,000 supply management professionals in 75 countries."

WHAT DR. ED SAYS:

The ISM manufacturing index provides some of the timeliest information with regard to the manufacturing sector. Information is also broken down by industry, allowing for a more detailed review of the current situation. The report takes into account several significant factors of business operations including: new orders, supplier deliveries, employment, production, and prices. Certain areas in the report are subdivided even further, such as prices of commodities and the supply of materials. This means that the sentiments of the entire manufacturing sector are at your disposal. This valuable tool can give you a better understanding of the current market picture.

The ISM website will further detail the situation. The index provides interesting insight with respect to levels above and below the expansion and contraction threshold of 50. For instance, the Institute for Supply Management considers prolonged periods of levels below 41.1 a contraction in the overall economy.

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