2011 Economic Calendar
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ISM Mfg Index  
Released On 9/1/2011 10:00:00 AM For Aug, 2011
PriorConsensusConsensus RangeActual
ISM Mfg Index - Level50.9 48.5 47.0  to 51.9 50.6 

August didn't prove that bad of a month for the manufacturing sector based on ISM data which show what could be described as no worse than mixed results especially for order readings. The composite index edged only three tenths lower to a plus-50 reading of 50.6 that still indicates monthly expansion in general activity though at a very slow rate. The composite was held back by a slowing in employment and a slight monthly contraction in production. But order readings aren't alarming with new orders, up four tenths to 49.2, essentially showing no change from July which is very good news considering August's run of shocks. Backlogs extended three months of contraction but at a less aggressive rate while export orders continued to expand, though they did expand at a slowing rate.

A plus in this report is an easing in input price pressure which will give manufacturers some breathing room in their production and hiring plans. The cut-off date for this report likely excluded the month-end shock of Hurricane Irene which does raise the risk that government data will show less resilience. The stock market is showing strength in reaction to today's data.

Consensus Outlook
The composite index from the ISM manufacturing survey in July eased to a disappointing 50.9 reading from a moderately healthy 55.3 figure for June. Although the July index is still above 50 to indicate monthly expansion in business conditions, it indicates only very marginal growth and is now at the slowest rate so far of the recovery. Forward momentum has stalled. New orders technically contracted in the month, coming in below breakeven at 49.3. However, new orders are volatile and this is the first sub-50 reading since June 2009. Backlog orders contracted more deeply, down four points to 45.0 for the lowest reading since April 2009. Factory managers are still hopeful about output growth as the employment index posted in positive territory 53.5 (indicating workforce gain).

The manufacturing composite index from the Institute For Supply Management is a diffusion index calculated from five of the eleven sub-components of a monthly survey of purchasing managers at roughly 300 manufacturing firms nationwide. The survey queries purchasing managers about the general direction of production, new orders, order backlogs, their own inventories, customer inventories, employment, supplier deliveries, exports, imports, and prices. The five components of the composite index are new orders, production, employment, supplier deliveries, and inventories (their own, not customer inventories). The five components are equally weighted. The questions are qualitative rather than quantitative; that is, they ask about the general direction rather than the specific level of activity. Each question is adjusted into a diffusion index which is calculated by adding the percentage of positive responses to one-half of the unchanged responses.  Why Investors Care
The ISM manufacturing index (formerly known as the NAPM Survey) is constructed so that any level at 50 or above signifies growth in the manufacturing sector. A level above 43 or so, but below 50, indicates that the U.S. economy is still growing even though the manufacturing sector is contracting. Any level below 43 indicates that the economy is in recession.
Data Source: Haver Analytics

2011 Release Schedule
Released On: 1/32/13/14/15/26/17/18/19/110/311/112/1
Release For: DecJanFebMarAprMayJunJulAugSepOctNov

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