New Orders, Production Register Slowing April Activity
The Moldmaking Index reported slowing expansion in April as several index components moved lower, more than counteracting the upward influence of supplier delivery activity.
The accelerating expansion trend the Moldmaking Index has experienced since December 2020 cooled slightly in April with a 58.3 reading. This latest reading was 3 points below the all-time high of 61.3 during the prior month. Despite the overall decline in the Moldmaking Index, the latest supplier delivery reading set a third consecutive record-breaking high. It was joined by employment activity which also reported accelerating — although not record-breaking — expansion in April. In contrast, export activity fell below 50 in April, signaling contracting activity after issuing a two-year high in March. The remaining components, new orders, production and backlog activity, registered slowing expansion. This occurs when an index component moves lower yet remains above a reading of 50.
Total new orders registered slowing growth while export orders contracted. Much of the expansion in moldmaking orders during COVID-19 has come from domestic demand.
The 15-point spread between the current and prior high reading for supplier deliveries set in 2018 can be difficult to comprehend. In short, a reading of 80 requires at least 60% of respondents to indicate that month-to-month supplier deliveries slowed while a reading of 64 can be achieved with as few as 30% of respondents reporting similar conditions. This and other unprecedented conditions appear to be due to the aftereffects of COVID-19 coupled with government policies to stimulate the economy.
January 2019 – 54.6
Strong expansion in production and quickening supplier deliveries hint at a rebound.
October saw slowing expansionary activity, an advancement caused by slowing supplier deliveries and an expansion in employment activity for a third consecutive month.