The Performance of Manufacturing Index (PMI), at 53.2 in March, has now been above the breakeven 50 mark for three consecutive months.
Historically, manufacturing sector output has been closely tied to the state of the broader economy. Across the economy, higher business confidence has been largely due to expectations of stronger future demand, rather than current conditions.
At times last year, our commentary on the PMI noted a destocking trend. This suggested more scope for manufacturing production to pick up upon an eventual turn in demand.
The PMI employment index edged up to 54.7, its highest level since July 2021. This level, well above 50, is consistent with a rapidly expanding workforce.
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