Flash manufacturing PMI unexpectedly jumped to 52.4 in November, which was higher than the 51.0 reading economists were looking fore.This is up from 51.3 last month.
Any reading above 50 signals expansion.
And Hurricane Sandy may have played a tiny bullish role.
From the report: “some panellists also commented on new work resulting from the aftermath of Hurricane Sandy.”
Here are the key points from Markit:
- PMI signals moderate improvement in manufacturing business conditions
- Both output and new order growth quicken to five-month highs
- Strongest rise in employment since July
- Average input prices increase markedly
“The U.S. manufacturing sector reported the fastest pace of expansion for five months in November, with output, order books and employment all growing at increased rates.
“This is an encouraging sign that the slowdown in the goods-producing sector may have bottomedout. Manufacturing therefore looks likely to make a positive contribution to economic growth in the fourth quarter after acting as a slight drag in the third quarter. The survey is consistent with manufacturing output growing at an annualised rate of just over 1.0% in November.
“Orders from domestic customers provided the main stimulus to higher production, though it is also reassuring to see exports stabilise, suggesting trade will also act as less of a dampener on the economy than during the summer months.
“However, it was not all good news, with producers reporting the largest monthly increase in their input prices since March, although the increase was partially caused by shortages of certain goods after supply had been disrupted due to the storms. Higher raw material prices will inevitably hit profit margins, though it is unclear how sticky these higher prices will prove to be.”
Here’s a historical chart:
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