ISM Non-Manufacturing Signals Growth Remains Solid

Wells Fargo Research Team Wells Fargo

The ISM non-manufacturing index edged down a tick in January to a still-solid 56.5. Taken together with the manufacturing index, the ISM readings indicate the economy continues to gain some momentum.

Steady Gains

Activity outside the manufacturing sector continued to expand at a solid pace in January with the ISM non-manufacturing index coming in little changed at 56.5.
Among components, the indices on current activity and new orders moved down slightly but remained above their respective six-month averages.

Supplier delivery times, on the other hand, lengthened at a faster pace.

Employment and Prices Rising The employment component moved up two points to 54.7, consistent with the stronger pace of hiring reported earlier this morning in the January employment report.
Price pressures mounted further last month, with the prices paid index rising at the fastest rate since the spring of 2014.
A weighted average of both ISMs shows economic activity has strengthened noticeably since the middle of 2016.

Author

Wells Fargo Research Team

Wells Fargo

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