February PMI improves marginally
The most heartening trend in the latest numbers is that the PMI employment index rose back above the key 50 mark to 51.6, indicating that the factory sector may have started employing again. The February rise to above 50 follows nine consecutive months of below 50 readings.
On a more negative note, the PMI price index surged by more than 10 points in February to above 80 index points. The February number was the highest level since the end of 2008 and indicates that manufacturing sector input costs are accelerating sharply.
The indices measuring new sales orders and business activity were both stable with the former remaining at a relatively high level at around 59 index points, while factory activity levels rose marginally to 51.6 points.
Purchasing managers were somewhat less optimistic regarding the outlook for future business conditions – the expected business conditions index declined by 5.8 index points. The index nevertheless remained above the 60 index point mark for the fifth consecutive month.