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KBC News Picks

US: ISM new orders rise above 50 in May

Tue, Jun 2 2009, 09:05 GMT
by KBC Market Research Desk

KBC Bank  |  View company's profile


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In May, the US manufacturing ISM showed its fifth consecutive improvement. The headline index rose from 40.1 to 42.8, slightly above the consensus estimate (42.3). Looking at the details, new orders (51.1 from 47.2) climbed above the boom/bust level, for the first time since November 2007. Also production (46.0 from 40.4), backlog of orders (48.0 from 40.5), supplier deliveries (49.8 from 44.9) and new export orders (48.0 from 44.0) rose significantly, while imports (42.5 from 42.0) increased more moderately. Producers became somewhat more negative about inventories with both inventories (32.9 from 33.6) and customer inventories (46.0 from 49.5) deteriorating. Employment stayed broadly unchanged (34.3 from 34.4), while prices paid rose sharply (43.5 from 32.0). The growth in new orders is an encouraging sign as the sub-index is considered as a leading indicator, but both inventories and employment remain close to the record lows.


Other: UK manufacturing PMI surprises on the upside

In the UK, manufacturing PMI surprised again on the upside of expectations in May. UK manufacturing PMI rose from an upwardly revised 43.1 to 45.4, while the consensus was looking for an outcome of 44.0. The index is now at its highest level since June 2008 and significantly above the low (34.5) reached in November last year. This outcome confirms that the worst for the UK economy might be behind us.


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This non-exhaustive information is based on short-term forecasts for expected developments on the financial markets. KBC Bank cannot guarantee that these forecasts will materialize and cannot be held liable in any way for direct or consequential loss arising from any use of this document or its content. The document is not intended as personalized investment advice and does not constitute a recommendation to buy, sell or hold investments described herein. Although information has been obtained from and is based upon sources KBC believes to be reliable, KBC does not guarantee the accuracy of this information, which may be incomplete or condensed. All opinions and estimates constitute a KBC judgment as of the data of the report and are subject to change without notice.
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