S.E. Michigan Purchasing Managers Index reflects growth, stability as year begins
As 2016 began, the Southeast Michigan Purchasing Managers Index (PMI) indicated an ongoing trend of growth and stability. The PMI for January 2016 was 57.1, bouncing back to November 2015’s figure. The number has been remarkably stable for the past six months.
A PMI value above 50 generally suggests an expanding economy, and the January index marks the 19th consecutive month at or above that value.
“This month, production activity accelerated with the index, and employment growth was strong as well,” said Nitin Paranjpe, a finance faculty member in Wayne State University’s Mike Ilitch School of Business, who interpreted this month’s results.
More than 86 percent of January survey respondents indicated that they believe the regional economy will become more stable, or remain about the same, over the next six months.
Respondents did, however, express concerns that a strong US dollar and a slowdown of growth in China and Europe may be forcing a downward trend in commodity prices.
“Also contributing to deflationary pressures — as you’ll notice in very low gas prices at the pump — is the overabundance of crude oil in the marketplace,” said Kenneth Doherty, assistant vice president of procurement and strategic sourcing at WSU and an Institute for Supply Management board member. “This is obviously great for commuters’ wallets, and automakers also are seeing increased sales of less efficient but higher profit vehicles.”
The Southeast Michigan Purchasing Managers Index (PMI) is a research partnership between Wayne State University’s Mike Ilitch School of Business and the Institute for Supply Management - Southeast Michigan.
The full report can be found at http://www.ism-sem.org/resources/files/Report-on-Business-January-2016.pdf.
