U.S. Manufacturing Sector Losing Momentum, NAPM Says

For the third consecutive month the U.S. manufacturing sector failed to grow, according to the National Assn. of Purchasing Management's (NAPM) Report on Business. "Manufacturing is feeling the effect of higher interest rates, higher energy prices, and the strong dollar," explains Norbert J. Ore, chair of NAPM. "Though prices still remain firm in most markets, with the exception of some metals, the manufacturing sector in general appears to be losing momentum faster than the overall economy." Indeed, NAPM's Purchasing Managers' Index was 48.3% in October, a decrease of 1.6 percentage points from 49.9% in September. NAPM's Production Index decreased 3.7 percentage points from 52.1% in September to 48.4% in October. NAPM's New Orders Index declined 1.1 percentage points from 49.1% in September to 48% in October. NAPM's Backlog of Orders Index registered 41%, indicating smaller backlogs for the sixth consecutive month. NAPM's Supplier Deliveries Index is 51.4% in October, indicating slower deliveries during the month. Of the 20 industries in the manufacturing sector, only seven reported improved business in October. Industries that reported improvement over September were (listed in order): Wood & Wood Products; Food; Furniture; Glass, Stone & Aggregate; Chemicals; Electronic Components & Equipment; and Apparel.