October MBI at 60.1 – 15th Consecutive Month of Growth

With a reading of 60.1, the MBI showed that the metalworking industry continues to grow at a strong pace. During the 15 consecutive months of growth in the MBI, the average level for the overall MBI has been 58.1. So, for the last two months the metalworking industry has been growing faster than the average rate of growth during this expansion.

In a rare occurrence, all of the subindices contributed to the positive reading. However, results showed some subindices made improvement while others slowed down. Most importantly, new orders grew at their fastest rate since January. Because production has been growing at virtually the same rate all year despite ups and downs in new orders, backlogs grew at slightly slower rate in October. Another significant contributor to the slightly faster growth was the exports subindex moving up to 60.5 from 50.0. The significant fall in the dollar in August through October likely played a significant role in this improvement. Material prices are still increasing, but at a much slower rate than earlier in the year. However, prices received by the metalworking industry have fallen three out of the last four months. This continues to put pressure on margins and could be a reason for the slowing growth in employment. Future business expectations remain substantially higher than the average level since the inception of the MBI.

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