The initial data for August is much better than anyone expected.

The first look at August data was released last week and was much better than feared. The ISM Index reported another surge coming in at 56.0 for the month, up from 54.2 in July. This index had been below the expansion level of 50 for four months since February, when it dropped well below. It recovered in May and reached the highest level since November 2018 in August. There is a strong correlation between this indicator of growing manufacturing activity and the growth in Real GDP. This reading does confirm the continued rebound in the manufacturing activity as the economy re-opens.

 

PROBANK AUSTIN ADVISOR - SEPTEMBER 8, 2020