US ISM manufacturing index to rise slightly in June – Wells Fargo

Research Team at Wells Fargo, notes that the US ISM manufacturing index posted its third consecutive reading above breakeven in May.

Key Quotes

“Improvement in the ISM over the past several months indicates the manufacturing sector is recovering from the weight of the strong dollar, collapsing commodity prices and weak global growth.

Continued expansion in production, new orders and export orders supported the composite index. That said, hiring conditions in the factory sector remained in contraction territory at 49.2. The prices paid component, however, has now risen to its highest level since 2011. Although higher prices put a squeeze on profits, it may also indicate inflation will continue to firm over the coming year. We look for the ISM manufacturing index to rise slightly in June to 51.5 as some of the headwinds facing the factory sector abate."