Economists who looked at last month’s barely above contraction report and predicted the same results this month were nearly spot on.

Last month the Manufacturing ISM was 50.2, this month the Bloomberg Consensus was 50.0, and the report came in at 50.1. 

 For a third straight month, the ISM is skirting near contraction, at 50.1 in October vs 50.2 and 51.1 in the prior two months.

New orders are showing some life, up nearly 2 points to a 52.9 reading that is safely above breakeven 50. Production is also at 52.9. But other readings are not as a favorable. Backlog orders remain in deep contraction at 42.5 while employment, for the first time in six months, is also in contraction, down nearly 3 points to 47.6. Exports have been the difference this year for the factory sector and new export orders in this report, at 47.5, remain below 50 for the fifth straight month. Prices, at 39.0, extended their long run of contraction.

ISM October 2012-Present

That was the lowest reading since May of 2013. Let’s investigate all the details of today’s report straight from the Institute for Supply Management Manufacturing ISM® Report On Business® released this morning.

Index Oct Sep PP Change Direction Rate of Change Trend in Months PMI® 50.1 50.2 -0.1 Growing Slower 34 New Orders 52.9 50.1 +2.8 Growing Faster 35 Production 52.9 51.8 +1.1 Growing Faster 38 Employment 47.6 50.5 -2.9 Contracting From Growing 1 Supplier Deliveries 50.4 50.2 +0.2 Slowing Faster 3 Inventories 46.5 48.5 -2.0 Contracting Faster 4 Customers’ Inventories 51.0 54.5 -3.5 Too High Slower 3 Prices 39.0 38.0 +1.0 Decreasing Slower 12 Backlog of Orders 42.5 41.5 +1.0 Contracting Slower 5 Exports 47.5 46.5 +1.0 Contracting Slower 5 Imports 47.0 50.5 -3.5 Contracting From Growing 1