The ISM U.S. manufacturing index issued today reflected the generally upbeat reports on manufacturing in October.
This positive swing is true for North America as a whole, says Bill Adams, senior international economist for PNC Financial Services Group:
“Signs of an improving economy include the Canada PMI, at a multi-year high, the U.S. ISM manufacturing index, up marginally despite the government shutdown and debt ceiling fight, the HSBC Mexico PMI, up slightly though at a low level, and now the IMEF manufacturing index, at a seven-month high after adjusting for seasonality and firm size. Given the close correlation of the manufacturing business cycles in Canada, the United States, and Mexico, the preponderance of positive evidence outweighs the decline in the Markit PMI for the United States.”
The manufacturing index from the Mexican Financial Executives Institute (IMEF) crept up from 49.5 in September to 49.9 in October.
If stronger manufacturing is sustained, Adams says, the United States, Canada, and Mexico should experience some "catch-up growth" near the end of the year.