US Manufacturing

Wow. The good people at the Institute for Supply Management survey American manufacturers every month and ask, “how’s business?” They then create a diffusion index based on those responses: a scale from 0 to 100, where 0 is no one says business is improving and 100 is everyone says it’s getting better. So 50 means it’s evenly split. Historically, 60 has represented a high mark, 40 a low mark, although there have been occasions beyond this range.

The October index jumped to 59, and the new orders index rose to nearly 66. The strong reading translates to a real GDP growth rate of 5.2%. That may be a bit high, but here we have another datum that the US economy is picking up steam.