Four Straight Months of Growth for the PMBI

With a reading of 52.4, Gardner’s precision machining index showed that business conditions expanded for the fourth month in a row in April. However, the rate of growth generally has been slowing down during that period. Compared with last April, the index was 8.7 percent higher. This is the seventh month in a row that the month-over-month rate of change has increased. The annual rate of change has grown at an accelerating rate the last 3 months.

New orders increased for the fifth straight month, but the rate of growth has slowed the last 3 months. Production has expanded the last 4 months and at a generally faster rate each month. Therefore, backlogs contracted for the first time since last December. However, backlogs are still increasing at a rapid rate compared with 1 year ago. This is a positive sign for future capacity utilization levels and capital spending. Hiring has increased at a slightly faster rate since February. After growing in March, exports contracted once again in April. Supplier deliveries continue to lengthen, but they have lengthened more slowly in recent months.

In the first 4 months of this year, material prices have increased at a faster rate than almost every month last year. While prices received had been increasing since November, they have contracted for 2 consecutive months. Future business expectations are still relatively strong, but they have declined for 3 straight months. 

Facilities with 50-249 employees continued to grow in April, but the rate of growth has slowed significantly since January. While shops with fewer than 20 employees grew in January, they contracted in April at their fastest rate since last November. All other facilities continued to expand at a fast rate.

Four of six regions expanded in April. The North Central—East region expanded at the fastest rate and has grown the last 4 months. It was closely followed by the Southeast and West regions, which grew at the same rate. Both regions saw slower growth compared with last month. The North Central—West region contracted after growing at a significant rate the previous 3 months. The Northeast region contracted for the third straight month.

Planned capital expenditures hit their highest level since February last year. After contracting the previous three months, the month-over-month rate of change increased 21.0 percent.