US manufacturing PMI hits 55.6 in July, strongest in 4 years

The U.S. manufacturing sector expanded at its fastest pace in over four years in July, according to a key industry survey released on August 3. The Institute for Supply Management's Manufacturing Purchasing Managers Index rose to 55.6 last month, up from 53.3 in June, marking the seventh consecutive month of expansion and the highest reading since May 2022. A reading above 50 indicates growth.

The strong performance was driven by a significant surge in production, with that subindex jumping to 58.5, its highest level since November 2021. New orders also grew for a seventh straight month, while the backlog of orders and new export orders both expanded. Notably, the employment index crossed into expansion territory for the first time in 33 months, climbing to 52.8 from 49.7 in June. Fifteen of the 16 manufacturing industries tracked by ISM reported growth during the month.

Susan Spence, chair of the ISM Manufacturing Business Survey Committee, said the July result reflected broad-based momentum, with four of the five PMI subindexes growing at a faster rate than in June. She suggested the improvement represents a sustained trend, with companies seeing solid demand factors...