U.S. manufacturing expansion sustained
WEEKLY MARKET COMMENTARY |
The detail inside the Institute for Supply Management’s Manufacturing Index published November 1 implies robust expansion in the sector will continue. Both the forward-looking production and new orders sub-indexes are pointing to a sustained period of strength in the final two months of the year. This data is consistent with the Federal Reserve’s policy path, which will likely result in an additional 25-basis point interest rate increase in December. In our estimation, this data should also pave the way for the Central Bank to upgrade the overall economic outlook at the December meeting.
While the focus will be on the top-line reading of 58.7, which is slightly above the six-month average of 57.9, the real story is in the details, all of which indicate strong demand for manufactured goods in the U.S. and abroad.