The latest quarterly business outlook index compiled by the Manufacturers Alliance/MAPI stands at 74, up eight points from 66 three months ago and the highest mark since September 2004. The index's all-time high of 80 was in June 2004.
An index figure above 50 indicates that U.S. manufacturing activity generally is expected to increase during the next three months.
"Despite oft-mentioned concerns about higher energy and commodity prices, a lower growth rate for consumer spending, a slowing of the housing and auto sectors, and higher interest rates, the manufacturing sector appears to be on solid footing and poised for yet another year of expansion," says Donald A. Norman, the alliance economist who oversees a periodic survey of senior financial executives from which the index is calculated. The composite index is a weighted sum of prospective shipments, backlogs, inventories and profit margins.
The alliance is an Arlington, Va.-based business and public policy research group.