The non-manufacturing ISM surveys nearly 400 firms from 60 sectors across the United States, including agriculture, mining, construction, transportation, communications, wholesale trade and retail trade. Beginning with the January 2008 report, a new composite index was made public and is now the headline number. It is considered an indicator of the overall economic conditions for the non-manufacturing sector and consists of four equally weighted indexes: business activity, new orders, employment, and supplier deliveries. Why Investors Care
| Released on 1/4/08 For Dec 2007 | ||||||||||||
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Highlights
The jobs report may be pointing to a hard slowdown but not the ISM non-manufacturing report which offers a reminder that economic growth is still alive. The ISM non-manufacturing index slipped a tiny 2 tenths in December to 53.9. Even the employment index showed strength, up 1.3 points to 52.1.
New orders rebounded from a dip in the prior month to show a respectable 53.5 level. Backlog orders held steady, rising slightly to 49.0. One negative was a 5.5 point drop in export orders to a 50.0 level that indicates no change in the month. One positive here is that the dollar is heading still lower and only about one fifth of the ISM's non-manufacturing sample is exporters. Inventories were unchanged at a very steady 50.5. Prices pressures remain well elevated at 72.7 though they are back from November's 76.5.
This report will take a bit, but only a bit, out of this morning's sting from the BLS. Treasuries firmed as did the dollar in reaction to the report.
The business activity index from the ISM non-manufacturing survey in November slipped 1.7 points to a moderate 54.1. The big negative in the report was a sharp fall in new orders, which declined 4.6 points to 51.1, which is barely above break even. Another big negative in the report was a jump in prices paid, up 13 points to 76.5 and reflecting the effect of high gas prices. The ISM non-manufacturing index is one more indicator pointing to a combination of sluggish growth and higher inflation.
Business activity index Consensus Forecast for December 07: 53.8
Range: 52.0 to 55.0
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Beginning with the January 2008 report, a new composite index was made public and is now the headline number. It is considered an indicator of the overall economic conditions for the non-manufacturing sector and consists of four equally weighted indexes: business activity, new orders, employment, and supplier deliveries. |
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