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Morning Notes — Pricing Power

Pricing Power

September 1, 2020

The US August ISM manufacturing index came in at 56.0 vs consensus for 54.5 and July’s 54.2.  Like PMIs, the ISMs are presented as a ‘diffusion index’ with levels above 50 signaling expansion and the distance above or below 50 measuring velocity.  The most startling component of today’s report were new orders rising +6.1 points to 67.6, its highest reading since December 2003.  The ‘prices paid’ component was also interesting, increasing +6.3 points to 59.5, with the survey provider calling the move a ‘shift to seller pricing power.’

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