S&P Global U.S. Manufacturing PMI Climbs to 55.9, Highest Since May 2022

The S&P Global Manufacturing PMI was 55.9 in September, up from 53.9 in August and the highest reading since May 2022. Amid increased domestic demand, production rose at a faster rate, while new orders grew at the quickest pace since April. At the same time, export orders declined, while input prices increased at a steeper rate due to tariffs, higher energy prices and supply shortages.

Growth in production and new orders was driven by broad increases in demand led by government and tech-related industries. In line with strong production and sales forecasts, manufacturers built inventories of inputs and finished goods, with stocks of purchases rising for the sixth consecutive month.

Additionally, backlogs of work rose for the seventh consecutive month due in part to delivery delays and difficulties finding workers. Despite hiring struggles, firms increased staffing levels at the highest rate in over five years in an effort to expand capacity. Optimism remains elevated due to positive order book pipelines as well as hope for a drop in energy prices.