The Institute for Supply Management released their February 2008 Non-Manufacturing ISM Report on Business today. 
The Non-Manufacturing Index (NMI) rose 4.7% to 49.3% up from 44.6% in January. Readings below 50 indicate that the non-manufacturing sector is generally contracting. Economists had forecasted that the NMI would rise to 47.3%.
Here is what some of the Respondents had to say:
- "Business remains strong in 2008 despite signs of an economic downturn." (Professional, Scientific & Technical Services)
- "January was a very slow month and February has started off at the same pace." (Wholesale Trade)
- "Business drops significantly as we move away from the holiday season." (Retail Trade)
- "Weakness continues in both volume and pricing." (Agriculture, Forestry, Fishing & Hunting)
- "Financial services companies are beginning to stabilize from the effects of the subprime market issues, but overall will continue to focus on business as usual by increasing productivity of current workforce and supply base and limit any increases at this time." (Finance & Insurance)
This was a strong reversal today and adds further evidence that we may not yet be in a recession. During the 2001 recession, NMI was below 50 9 out of 10 months from April 2001 to January 2002. It averaged 48.3 during that period.
Bespoke Investment Group posted a chart on the odds that the U.S. will enter a recession in 2008 (measured by Intrade contracts and defined as 2 consecutive quarters of negative GDP growth). The odds have declined from a peak of 77.5% to current odds of 59%.
Sphere: Related Content
No comments:
Post a Comment