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PURCHASING MANAGERS REPORT SOFT

 DETROIT, Aug. 2 /PRNewswire/ -- July's survey of the National Association of Purchasing Management - Metro Detroit (NAPM-MD) compiled by Comerica Bank reported a second consecutive monthly decline in its Composite Index of business conditions. The index registered 48.2 for July, down 8 points from 56.2 in June, and significantly below the 55.4 level recorded in July 1992.
 Comment
 "Between June and July, a significant loss in momentum occurred in every category of the overall survey," said David L. Littmann, first vice president and senior economist with Comerica Bank in Detroit. "Even adjustments for seasonal variation did not avert the sharp reversals noted by local purchasing managers in auto sector production and new order activity. Only inventories and prices of purchased materials remained expansive in July. A similar, but less severe loss of momentum occurred in the non-auto sector," said Littmann.
 Littmann described local economic conditions in July as neutral to soft. "A similar reading in August would not bode well for Michigan or the U.S. in the months ahead, since autos have been one of the few props underpinning this year's economic expansion."
 Items noted in short supply during July included many iron and steel products, some valves, clamps, castings (iron and aluminum), bearings, hydrochloric acid, and computer notebooks.
 Comments from survey respondents included the depressing effects of the auto shutdown in July; the effects of flooding on transportation; the poor economic conditions in eastern and western states; and uncertainty surrounding the outcome of Washington's budgetary process and its impact on segments of the capital equipment market.
 AUTO NON-AUTO TOTAL
 JUNE JULY JUNE JULY JUNE JULY
 NAPM - MD Index 55.8 39.9 56.3 51.3 56.2 48.2
 Production 70.0 37.5 61.1 51.6 63.7 47.7
 New Orders 60.0 40.9 65.3 53.2 63.7 50.0
 Inventories 46.7 54.2 55.6 48.4 52.9 50.0
 Employment 60.7 45.8 56.9 56.5 58.0 53.5
 Vendor Performance 40.0 25.0 45.8 43.5 44.1 38.4
 Prices 63.3 58.3 59.7 54.8 60.8 55.8
 Weighting 29.4 27.9 70.6 72.1 100.0 100.0
 Comerica Bank compiles the NAPM-MD survey report from monthly responses of local purchasing managers belonging to the 500-member NAPM-MD (National Association of Purchasing Management - Metro Detroit). The report indicates whether fundamental measures of the economy are stronger, weaker, or unchanged from the prior month.
 The Composite Index is a seasonally adjusted weighted average measure of new orders and production activity along with employment, inventories and the promptness of supplier company deliveries. The index ranges from 0 to 100. A reading below 50 generally means conditions are deteriorating; levels above 50 denote expansion. The Composite Index and its components have been tabulated since October 1985.
 -0- 8/2/93
 /CONTACT: David L. Littmann, First Vice President & Senior Economist, Comerica Bank, 313-222-7241/
 (CMA)


CO: Comerica Bank ST: Michigan IN: FIN SU: ECO

ML -- DE011 -- 8305 08/02/93 11:03 EDT
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Publication:PR Newswire
Date:Aug 2, 1993
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