US Factory Growth Strongest in 4 Years

The ISM Manufacturing PMI rose to 54 in May 2026 from 52.7 in each of the previous two months and beating forecasts of 53. The reading pointed to the strongest expansion in the factory sector since May 2022, with faster growth seen for new orders (56.8 vs 54.1), production (54.3 vs 53.4) and backlog of orders (52.2 vs 51.4). Also, employment contracted less (48.6 vs 46.4). Price pressures remained elevated but below the levels seen in April (82.1 vs 84.6). The Supplier Deliveries index stayed the same at 60.6. Meanwhile, the Customers’ Inventories Index remains in ‘too low’ territory, contracting at a slower rate. A ‘too low’ status for the Customers’ Inventories Index is usually considered positive for future production. "Among comments, the Iran war was mentioned in 42 percent and tariffs in 18 percent; 57 percent of the panelists mentioned pricing volatility as an issue for their companies", according to Susan Spence, Chair of the ISM Manufacturing Business Survey Committee.

The ISM Manufacturing PMI for the US remained unchanged at 52.7 in April 2026, matching its highest level since August 2022 but falling short of market expectations for a rise to 53.0. New orders grew at a faster pace (54.1 vs. 53.5 in March), and supplier deliveries lengthened further (60.6 vs. 58.9), while production expanded at a slower rate (53.4 vs. 55.1), and employment levels declined at the sharpest pace in four months (46.4 vs. 48.7). Prices surged at the fastest rate since April 2022, driven by rising oil and diesel costs linked to the Middle East conflict. According to Susan Spence, Chair of the ISM Manufacturing Business Survey Committee, sentiment among panelists remained mixed in the second month of the Iran War. While 31% of comments were positive, 69% were negative, a ratio of 1 to 2.2. The war was mentioned in 47% of responses, with tariffs referenced in 18%. Some panelists addressed both issues in a single comment, often with conflicting sentiment.

The ISM Manufacturing PMI for the US increased to 52.7 in March 2026 from 52.4 in February and above forecasts of 52.5. The reading pointed to the strongest growth in factory activity since August 2022, led by a faster increase in production (55.1 vs 53.5) while new orders slowed (53.5 vs 55.8) and employment contracted slightly faster (48.7 vs 48.8). Also, the prices index jumped to 78.3, the highest since June 2022, from 70.5. “The Supplier Deliveries Index indicated a further slowing for the fourth month in a row (58.9 vs 55.1). March "also marks the first report with panelists citing the Iran war as a new impact to their business, along with ongoing uncertainty with U.S. economic policy, despite the recent Supreme Court ruling striking down International Emergency Economic Powers Act (IEEPA) tariffs. In March, 64% of comments overall were negative. Among the negative comments, about 20% cited tariffs and about 40% the war in the Middle East", Susan Spence, Chair of the ISM said.