Feb. ISM Non-Manufacturing Preview
The Feb. ISM Non-Manufacturing Index will be released at 10:00am EST and is expected to come in at 47.3 after an all-time low of 44.6 in Jan. That low was a surprise and a significant drop from December’s 53.2, which was actually a slight increase from Nov.
The Jan. decline in the Non-Manufacturing index was also unique as only the 3rd noticeable drop below the ISM Manufacturing Index. It was the largest drop beneath Manufacturing in the indices’ history, with a nearly 6-point spread. The only time the ISM Non-Manufacturing Index managed to stay beneath ISM Manufacturing for a protracted period was at the end of ‘03 and the beginning of ‘04.
Many economists note that the 2 indices are correlated, with Non-Manufacturing lagging Manufacturing by a month. Manufacturing climbed from 48.4 in Dec. to 50.7 in Jan., which for most forecasters translates to a Jan.-to-Feb. increase for ISM Non-Manufacturing.
However, with ISM Non-Manufacturing at all-time lows and beneath ISM Manufacturing, plus all 5 ISM-related surveys below 50, previous correlations may be nullified.