Having hit cycle highs over 57 in February (in peak cold-weather season), US Manufacturing PMI appears unable to regain the positive momentum of that peak despite weather no longer being an issue. While the 56.2 print beat expectations of 55.5, with new orders improving, the all-too-crucial employment sub-index dropped to its slowest rate of expansion in 2014. Until just a few months ago when this macro indicator started to rise, it was seen as a secondary data item but once it started reinforcing the status quo believers trend it became crucial.
PMI beats but remains well below cold-season peak...
The full report breakdown:
The declining PMI employment index:
And perhaps most troubling:
On the price front, May’s data indicated an acceleration of input cost inflation to the strongest since January. Manufacturers suggested that the rise in input prices was broad-based, though the majority were unable to pass these higher costs on to their customers.
So, strong customer-driven economic recovery then? As long as it doesn't snow in the summer of course...