Dual ISM Indexes Confirm Positive January Gains
February 3, 2010 - January's ISM manufacturing index reached its highest level in five years, rising to 58.4% from the 54.9% noted for December. Any reading over 50 indicates a growing economy.
Economic activity in the manufacturing sector has been on the rise for the past six months. Thirteen of the eighteen districts in the Tempe, AZ based ISM were growing in January, up from the nine in December.
In another data release, the ISM non-manufacturing index reached 50.5% last month, up 0.7% from the 49.8% registered the prior month. The index, which covers services, construction and finance, has continually been less productive than its counterpart sector.
Though January's ISM has moved into a more positive zone, the gain was not nearly as vigorous as expected. However, recent increases in both of these indexes are likely to put some upward pressure on interest rates.
Besides the ISM data released this week, the Bureau of Economic Analysis announced that personal income rose by 0.4%. This is its sixth increase in a row, jumping $4.5 billion in December.
Positive data has been predominant throughout the week, but many will once again be awaiting January's employment report that is scheduled to be released at the end of the week.