US manufacturing PMI hits 12-year high amid strong domestic demand: IHS Markit



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US manufacturing PMI hits 12-year high amid strong domestic demand: IHS Markit

On Friday, a survey report from IHS Markit, the London, UK-based business research group, said that its index for US manufacturing PMI (Purchasing Managers’ Index) had picked up momentum earlier in May in context of a sharp rise in domestic demands, however, logjams of unaccomplished works were signalling a steep shortage of labour alongside raw materials.

In the latest flashpoint of an economic boom in the United States, an upbeat US manufacturing activity data came forth as consumers’ demands were reportedly shifted towards goods from services amid a pandemic-era new normalcy, while a sharp shoot-up in domestic demands following a robust re-opening of US economy added to further impetus.

On top of that, while new orders for US-borne core capital goods scoring solid growth last month, had bolstered hopes of an earlier-than-anticipated recovery, a persistent decline in weekly jobless claims could be translated to a gradually healing US labour market with layoffs dwindling further.

US manufacturing PMI hits highest since October 2009

Besides, the survey data from IHS Markit had revealed that its reading for flash US manufacturing PMI (Purchasing Managers’ Index) spurred up to 61.5 on early-May following an April final reading of 60.5, marking up the strongest figure since October 2009, however, analysts were expecting a drop to 60.2.

Meanwhile, with price pressures building amid a steep shortage of labours and raw materials, citing a hike in production costs which could feather up inflation jitters further, IHS Markit said in the report, “Manufacturers highlighted that strain on capacity and raw material shortages are expected to last through 2021…supply crunch was raising production costs for manufacturers who made efforts to pass higher cost burdens on to clients.