Boom Doom Economy: USA Manufacturing: Rapid Growth Continues in April (Chart) *USA economy expands for 23rd month*

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USA Manufacturing PMI (Purchasing Managers' Index) by the Institute for Supply Management

Official Statement by the Institute for Supply Management (Tempe, Arizona) - Economic activity in the manufacturing sector expanded in April for the 21st consecutive month, and the overall economy grew for the 23rd consecutive month, say the nation's supply executives in the latest Manufacturing ISM Report On Business. The report was issued today by Norbert J. Ore, CPSM, C.P.M., chair of the Institute for Supply Management™ Manufacturing Business Survey Committee. "The recent trend of rapid growth in the manufacturing sector continued in April as the PMI registered above 60 percent for the fourth consecutive month. The New Orders and Production Indexes continue to drive the PMI, as they have both exceeded 60 percent for five consecutive months. Manufacturing employment appears to have developed significant momentum, as the Employment Index readings for the first four months of 2011 are the highest readings in the last 38 years. Inventory growth also took place in April after two months of destocking; however, the inventory restocking would appear to be necessitated by the strong performance in new orders. While the manufacturing sector is definitely performing above most expectations so far in 2011, manufacturers are experiencing significant cost pressures from commodities and other inputs."

Trend The short-term trend has been down, but the ISM Manufacturing PMI has continued above the benchmark 60.0 for 4 consecutive months. The intermediate-term trend is upwards and the long-term trend is leveling off.

Cycle History The ISM Manufacturing PMI reached a Post-Great Recession peak of 61.4 in February 2011. A Great Recession cyclical low of 32.5 was set in December 2008. The PMI is a percentage - not a total. More about the PMI below the chart.

ISM Monthly Manufacturing PMI (Chart) Below is a chart of the Purchasing Managers' Index (PMI) from cyclical low, the Great Recession low of 32.5 in December 2008 through the latest month reported. The PMI has been greater than 50, indicating USA manufacturing is expanding, since August 2009, for 21 consecutive months. As can be seen, the PMI bottomed in December 2008 at 32.5, ascended significantly through August 2009 to 52.8, the first time above 50 since January 2008. The PMI continued upwards to a peak of 60.4 in March 2010. The PMI then decreased for 4 consecutive months (April 2010 through July 2010) and now has regained the 60.0 benchmark for 4 consecutive months. However, a PMI greater than 50 indicates USA manufacturing is expanding even when the monthly PMI was decreasing in some months in 2010, just at a slower rate.

Commentary The April 2011 PMI is the 4th consecutive month above the benchmark 60.0, which indicates robust growth. USA manufacturing is off to a strong start in 2011. The USA manufacturing sector continues to expand for the 21st consecutive month (PMI greater than 50.0) and the overall economy continues to expand for the 23rd consecutive month (PMI greater than 42.5). Key points of the current report:

● New Orders, Production, Employment, Inventories, Backlog of Orders, Exports, Imports growing

● Supplier Deliveries slowing

● Customer Inventories too low
● Prices increasing

About the PMI The ISM describes the PMI, the USA manufacturing metric as: A reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally contracting. A PMI in excess of 42.5 percent, over a period of time, generally indicates an expansion of the overall economy. The PMI is a composite of five indexes: New Orders, Production, Employment, Supplier Deliveries, and Inventories. 18 manufacturing industries are reported and represented in the PMI: Primary Metals; Apparel, Leather & Allied Products; Transportation Equipment; Fabricated Metal Products; Electrical Equipment, Appliances & Components; Miscellaneous Manufacturing; Computer & Electronic Products; Paper Products; Chemical Products; Food, Beverage & Tobacco Products; Printing & Related Support Activities. The five industries reporting contraction in August are: Furniture & Related Products; Petroleum & Coal Products; Nonmetallic Mineral Products; Plastics & Rubber Products; and Machinery.

About the Institute for Supply Management The Institute for Supply Management™, established in 1915, is the largest supply management organization in the world as well as one of the most respected. ISM's mission is to lead the supply management profession through its standards of excellence, research, promotional activities and education.

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