The manufacturing sector jumped in January and the service sector expanded for the 37th consecutive month. The Performance Manufacturing Index (PMI) registered at 53.1%, gaining 2.9% from December’s reading of 50.2% (Figure 2).
This strong performance was supported by fast growth in new orders, production, employment, inventories and prices, reflecting the relief of markets following the deal to avoid the fiscal cliff. Meanwhile, supplier deliveries, inventories, customers’ inventories, and backlog of orders were slower or lower this month. After the strong growth in December, both the Paper and Wood Products industries remained stable in January (Table 3). The Wood Products industry saw improvement in prices and backlog of orders, while the Paper Products industry saw improvement in prices only.
The Non-Manufacturing Index (NMI) grew for the 37th consecutive month to 55.2% in January (Figure 3). That was 0.9% lower than the 56.1% reading in December, suggesting a slightly slower growth rate. Employment, prices, exports, and imports indices grew at a faster rate, while the new orders index grew at a slower rate. Of the 13 non-manufacturing industries, the growth of Ag & Forestry, Construction, and Real Estate industries ranked first, third, and seventh in January.