A worker welds structural steel beams during production at the SME Steel Contractors facility in West Jordan, Utah, on February 1, 2021.
George Frey | Bloomberg | Getty Images
U.S. One step of manufacturing activity reached a 37-year high in March, driven by strong growth in new orders, a clear indication that much-anticipated economic boom is underway.
The Institute for Supply Management (ISM) said on Thursday that its national factory activity index had moved to a reading of .7 64. of last month, compared to .80 in February. It was the highest level since December 1983.
A reading above 50 indicates product expansion, accounting for 11.9% of the U.S. economy. Economists polled by Reuters forecast the index to rise to 61.3 in March. The Covid-19 epidemic that has been going on for years has increased the demand for goods.
Economic growth is expected this year, driven by the White House’s massive and 9 1.9 trillion epidemic relief package and the reopening of nonsensical businesses as more Americans are vaccinated against coronavirus.
The relief package passed last month is sending an additional check of $ 1,400 to eligible households and will extend the government’s safety net for the unemployed by September 6.
President Biden on Wednesday unveiled plans to spend about 2 2 trillion on infrastructure such as roads and bridges in 10 years.
The GDP for the first quarter is estimated at 10.0% per annum. The economy grew at a rate of a.3% in the fourth quarter. This year’s growth could reach a peak of 7%, the fastest since 1984. The economy contracted 3.5% in 2020, the worst performance in 74 years.
But the big financial stimulus could leave the economy under pressure from domestic capacity limits and fan inflation. Suppliers are already struggling to deliver materials to manufacturers, increasing production costs. This is most evident in the automobile industry, where the shortage of global semiconductor chips has forced production cuts.
The price ISM survey measures paid by manufacturers last month reached its highest level since July, 2008.
The new orders sub-index that appeared ahead of it reached .0 to .0 in March. This was the highest reading since January 2004 and was .8 from .. in February. Factories also received more export orders, while order backlogs increased.
There is scope for further expansion despite the inventories of manufacturers and their customers. With strong demand, factories hired more workers in March. The survey’s manufacturing employment gauge ratio is 59.6, the highest reading since February 2018, up from 54.4 in February.
It supports expectations for a sharp acceleration in employment growth in March. According to a Reuters survey of economists, nonfarm payrolls rose to 64,647,000 last month, up from 9379,000 in February. On Friday, the government is to publish the March employment report.
.
