Last updated on July 2nd, 2019 at 09:10 am
Any reading above 50 indicates growth in the region’s manufacturing sector. In May, the index dropped to 47.83, the first time it had been in negative territory in 31 months.
The jump, the largest for the index in more than a year, was enough to push the 6-month average higher for the first time in a year. The index had been trending down since reaching a high of 75.2 in February 2018.
The report showed improvement in nearly every category except order backlogs. New orders improved by 3.5 points and returned to growth and exports jumped 6.3 points to 56.25.
The 6-month business outlook was dampened slightly with the diffusion index, which balances positive and negative bias, dropping from 65.4% to 61.5%. The shift was driven by a slight decline in the percentage of respondents expecting conditions to improve. The number expecting conditions to get worse remained unchanged at 15.4%.
Despite the positive figures, there was reason for concern in the report as some respondent comments highlighted industry challenges.
“Long term forecasts suggest market increases that are not supported by economic indicators and other key trends,” one response said.
One respondent noted poor weather and a lack of available truck drivers has hindered on-time delivery for raw materials while another said a lack of qualified labor is leading to “significant supply chain issues.”