ISA Indices Fall below 50 for First Time in 2016

October 2016

The August ISA Economic Indicator Report from the Industrial Supply Association showed that the Manufacturer Index and the Distributor Index both fell below 50 for the first time in 2016, indicating a contracting economy.
The ISA Manufacturer Index decreased to 48.6 in July from 59.1 in June. Meanwhile, the ISA Distributor Index decreased to 44.9 in July compared to 60.4 in June.
For each index, a reading above 50 percent indicates expansion, while a reading below 50 percent indicates contraction.
“Business appeared to have suffered as a result of two fewer working days in July 2016 compared to July 2015,” said Bryon Shafer, general manager of ASG Industrial and chair of ISA’s Strategic Information Committee. “However, that serves as only a partial explanation for the slowdown. Member comments indicated that the July results were the lowest in several years.”