U.S. May Manufacturing PMI Hits 54.0, Expansion Continues for Fifth Consecutive Month

New Orders Rise from 54.1 to 56.8

U.S. manufacturing activity in May continued its expansion for the fifth consecutive month, reaching its highest level in four years. This surge is believed to be driven by companies increasing new orders as the war in Iran drags on.

The Institute for Supply Management (ISM) announced on June 1 (local time) that the Manufacturing Purchasing Managers' Index (PMI) for May rose by 1.3 points from the previous month to 54.0. This figure surpasses the expert forecast of 53.2 compiled by Dow Jones.

The PMI is an index that quantifies month-over-month changes in new orders, production, and employment as perceived by purchasing and procurement managers. Typically, a reading above 50 indicates economic expansion, while a figure below 50 signals contraction.

The May PMI reading of 54.0 marks the highest level since May 2022, when it reached 55.9. The new orders index rose by 2.7 points to 56.8 compared to the previous month, and the production index also climbed by 0.9 points to 54.3.

By industry, 16 out of 18 manufacturing sectors—including computers and electronic products, machinery, transportation equipment, and chemicals—showed growth. Only the wood products sector experienced contraction.

However, cost pressures for manufacturers remained high. The price index fell by 2.5 points from the previous month to 82.1, yet it still hovered near the highest levels since 2022. The supplier deliveries index held steady at 60.6, the same as the previous month. A reading above 50 indicates unfavorable transportation conditions.

According to Bloomberg News, companies may be stockpiling inventories in anticipation of future price increases resulting from the war in Iran.

This content was produced with the assistance of AI translation services.