December Reading Closes Out an Excellent 2017
December closes above 2017’s record-breaking average reading level.
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The December readings of the Precision Machining Index at 56.6 finished above the 2017 average reading of 55.6, which itself was a record for the index.
2017 ended on a surprise note when new orders registered as the fastest growing component of the Precision Machining Index. During most months of 2017, production was the fastest growing component. Gardner Intelligence attributes the increase in exports and backlogs to the strong new orders reading.
Registering 56.6 for December, the Gardner Business Index (GBI): Precision Machining closed out the year on a positive note as the index moved higher from the prior month. For 2017, the Precision Machining Index averaged a monthly reading of 55.6, besting all prior calendar year averages, including the prior record from 2014 of 54.2. Compared with the same month one year ago, the index increased by 5.3 percent. Gardner Intelligence’s review of the underlying data indicates that new orders, supplier deliveries and production lifted the business index higher, while employment, backlog, and exports pulled the index lower. For the month, no components contracted.
December experienced strong expansion in new orders, recording its second highest reading of the year and in the history of the index. Production also grew, but not as quickly, however, in Gardner Intelligence’s review of past trends, when new orders growth exceeds production growth, it is typical for the industry to experience additional growth in future months as manufacturers adjust to the increased demand. Such instances also tend to result in increased backlogs and/or exports readings, both of which expanded in December.
