Morning Notes — Pricing Power

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.’