Supply Chain Dynamics at Play in Today’s Rise in ISM Manufacturing

Summary The message from today’s ISM is that supply chain issues have gone from a problem to a crisis. The top drivers behind today’s jump in the ISM index to 61.1 were longer wait times for supplier deliveries and sharply higher prices paid. On the upside, hiring moved back into expansion. Supply Chain Problems Have Gone from Bad to Worse The ISM manufacturing index, a closely watched barometer of activity in the manufacturing sector, rose in September to 61.1, signaling its fastest pace of expansion since May. While that was certainly better than the consensus had been expecting, it is not all good news when you examine the underlying components. The largest overall increase among subcomponents was a 3.9 point pop in the supplier delivery index. This measure rises the longer that factories have to wait for supplies. Ordinarily a modest wait is consistent with a fast-growing economy. However, today it says more about the supply chain crisis. As if to put a big exclamation point on this issue, eight out of ten respondents reflecting almost every industry type cited supply chain and sourcing problems. READ FULL ARTICLE>>