US manufacturing PMI hits highest level since 1983 in March
Manufacturing sector activity surprised sharply to the upside in March, accelerating at its quickest pace in almost four decades.
The Institute for Supply Management's US Purchasing Managers' Index rocketed from February's print of 60.8 to 64.7 - reaching its highest level since December 1983.
Economists had penciled-in a reading of 61.5.
Nevertheless, in a note sent to clients, Pantheon Macroeconomics chief economist, Ian Shepherdson, cautioned that the recent passage of new fiscal stimulus and slower growth in China likely meant such strong readings would not last.
"This is remarkable, but it likely won’t last, for two reasons," he said.
"First, the spike in the index comes immediately after the passage of the American Rescue Plan Act, which puts $1.9T into the economy, mostly this year, on top of an already-strong cyclical rebound in manufacturing. No wonder firms are happy.
"Second, China’s PMIs, which usually lead the U.S. numbers by one-to-three months, have clearly lost momentum recently. They don’t signal outright weakness in the U.S., but they do point to lower ISM readings. Still, we have to expect strong growth in manufacturing output and employment over the next few months, at least."