Manufacturing PMI Continues Expansion in September

TEMPE, Ariz., Oct. 1, 2026 /CourierPR/ -- The Manufacturing PMI® registered 54.5 percent in September, marking a slight decline from the August figure of 54.6 percent. The overall economy continued to expand for the 23rd consecutive month, as indicated by the Manufacturing PMI® reading above 47.5 percent, which generally signifies economic growth.

New Orders Index expanded for the ninth consecutive month in September, registering 55.3 percent, up from 53.7 percent in August. The Production Index, however, contracted, dropping to 56.7 percent from 58.3 percent in August. The Prices Index remained in expansion, registering 77.9 percent, a notable increase of 6.8 percentage points compared to August's reading of 71.1 percent.

The Employment Index also saw a rise, reaching 52.7 percent, up from 51.2 percent in August. Meanwhile, the Supplier Deliveries Index continued to show slowing performance, with a reading of 59 percent, down 0.3 percentage points from its August reading of 59.3 percent. This reading indicates that deliveries are slowing, which is typical as the economy improves and customer demand increases.

The Inventories Index registered 48.6 percent in September, down 2 percentage points from its August figure of 50.6 percent. The Customers' Inventories Index, which had been in 'too low' territory in August, contracted further, registering 41.6 percent, down 1.2 percentage points from August's reading of 42.8 percent.

The New Export Orders Index saw a decline in September, dropping to 50.9 percent from 53.2 percent in August. The Imports Index, on the other hand, decreased to 51 percent in September, down 1.5 percentage points from August's reading of 52.5 percent.

In September, U.S. manufacturing activity remained in expansion territory. Of the five subindexes that make up the PMI®, only the New Orders and Employment indexes grew faster than the previous month. In September, 40 percent of the comments were positive and 60 percent negative, with a 1-to-1.6 ratio of positive to negative sentiment. Among negative comments, pricing volatility was mentioned in 46 percent, tariffs in 34 percent, the Iran war in 30 percent, and increasing lead times in 21 percent.

Regarding output, the Production Index expanded for the 11th month in a row, with the positive-to-negative comment ratio dropping to 1.6 positive comments for every negative one in September, compared to a 2.2-to-1 ratio in August and 3.3-to-1 in July. The Employment Index remained in expansion and gained 1.5 percentage points. The positive-to-negative comments ratio on Employment was 1.5-to-1 in September.

Inputs, defined as supplier deliveries, inventories, prices, and imports, were mixed. The Supplier Deliveries Index decreased by 0.3 percentage points, the Inventories Index declined by 2 percentage points, and the Prices Index increased by 6.8 percentage points, returning to its level at the start of the Iran War. The Imports Index lost 1.5 percentage points, to 51 percent versus 52.5 percent in August.

Looking at the manufacturing economy, 2 percent of the sector's gross domestic product (GDP) contracted in September, compared to 22 percent in August, and 2 percent of manufacturing GDP was in strong contraction (defined as a composite PMI® of 45 percent or lower), the same as in August. The share of sector GDP with a PMI® at or below 45 percent is a good metric to gauge overall manufacturing weakness. Of the six largest manufacturing industries, five (Computer & Electronic Products, Food, Beverage & Tobacco Products, Transportation Equipment, Machinery; and Chemical Products) expanded in September.

In September, three of four demand indicators (the New Orders, Backlog of Orders, and New Export Orders indexes) remained in expansion, and the Customers' Inventories Index remained in 'too low' territory, contracting at a faster rate. A 'too low' status for the Customers' Inventories Index is usually considered positive for future production.

The last 12 months saw the New Orders Index expand in September, with a reading of 55.3 percent, an increase of 1.6 percentage points from August. The Manufacturing PMI® registered 54.5 percent in September, 0.1 percentage point below the August figure of 54.6 percent. The overall economy continued in expansion for the 23rd month in a row, as indicated by the Manufacturing PMI® reading above 47.5 percent, which generally signifies economic growth.

The Manufacturing PMI® is a key indicator of economic health, and its continued expansion is a positive sign for the overall economy. However, the mixed performance in certain areas, such as inventories and prices, highlights the complex challenges facing manufacturers. The need for continued focus on supplier management and cost control, as well as the importance of addressing structural challenges like overcapacity and persistent pricing pressures, are clear from the comments of industry leaders.