The Purchasing Managers’ Index (PMI) declined 2.4 percentage points to 54.2% in February, from January. A reading above 50% indicates the manufacturing economy is generally expanding and below 50% indicates it’s generally contracting.
The New Orders Index declined 2.7 percentage points to 55.5%, the Production Index fell 5.7 percentage points to 54.8%, the Employment Index decreased 3.2 percentage points to 52.3%, the Supplier Deliveries Index dropped 1.3 percentage points to 54.9%, the Inventories Index rose 0.6 percentage points to 53.4%, and the Prices Index fell 0.2 percentage points to 49.4% — indicating lower raw materials prices for the second consecutive month after nearly three years of increases.
Demand and output in February were softer than in January. However, demand continues to expand, with the New Orders Index reaching the mid-50s, the Customers’ Inventories Index was lower and remaining too low and the Backlog of Orders returned to the low-50s expansion level. Consumption, or production and employment, continued to expand in February but fell a combined 8.9 points from January. Inputs, which comprise supplier deliveries, inventories and imports, were flat at a mid-50s level and had a slight negative impact on the PMI. Inputs continue to show the business environment is easing and was confirmed by the decline in the Prices Index.
Exports expanded at a slightly stronger rate in February, from January, and inputs and prices reflected an easing of the tightness in the supply chain, according to the report.
Of the 18 manufacturing industries, the following 16 reported growth in February: printing and related support activities; textile mills; computer and electronic products; electrical equipment; appliances and components; fabricated metal products; paper products; wood products; primary metals; chemical products; food, beverage and tobacco products; miscellaneous manufacturing; petroleum and coal products; transportation equipment, machinery; furniture and related products; and plastics and rubber products. The only industry that contracted in February was nonmetallic mineral products.