ISM Non-Manufacturing Index: The Institute for Supply Management’s non-manufacturing index decreased by 5.0 points month on month (-9.3% m/m) to 48.8 in June 2024.

The ISM non-manufacturing survey measures the rate and direction of change in activity in non-manufacturing industries. Surveys are sent to more than 400 purchasing managers in 18 industries. Survey responses reflect the change in the current month compared with the previous month. A value of 50 is neutral, while less than 50 denotes contracting non-manufacturing activity and greater than 50 denotes expanding activity.

Figure 1 breaks down the composite index and sub-indexes. The business activity sub-index was 49.6, while the imports sub-index was 44.0.

The eight services industries reporting growth in June — listed in order — are: Other Services; Management of Companies & Support Services; Health Care & Social Assistance; Construction; Utilities; Finance & Insurance; Educational Services; and Professional, Scientific & Technical Services. The eight industries reporting a decrease in the month of June — listed in order — are: Agriculture, Forestry, Fishing & Hunting; Real Estate, Rental & Leasing; Mining; Retail Trade; Public Administration; Wholesale Trade; Transportation & Warehousing; and Information.

“Costs seem to have stabilized but are still higher. The company is holding steady to see what the election will hold.” [Construction]

At Gerdau, we closely monitor the ISM non-manufacturing index since it is an excellent barometer of the present strength, as well as a window on the likely short-run future, of the U.S. non-manufacturing economy. We have seen that a strengthening non-manufacturing economy translates to improved steel consumption.