U.S. Manufacturing Price Pressures Surge as Demand Remains Strong

Inflationary pressure is building across the U.S. manufacturing sector.
The ISM Manufacturing Prices Paid Index jumped 6.8 points in September to 77.9, its highest level since May.
That was also the largest monthly increase since February.
Year to date, the index has risen 19.4 points, marking its third-largest nine-month increase since 2021.
At the same time, manufacturing activity remains firmly in expansion.
The ISM Manufacturing PMI slipped just 0.1 point to 54.5, extending its expansion streak to nine consecutive months, the longest since 2022.
New orders rose 1.6 points to 55.3, also recording a ninth straight month of expansion.
Backlogs strengthened sharply as well, with the index for unfilled orders jumping 4.6 points to 56.4, its second-highest reading since May 2022.
The combination of strong demand, rising backlogs and sharply higher input prices suggests manufacturers are facing increasing pressure on capacity.
If those costs continue rising, the manufacturing sector could become another source of persistent inflation pressure for the broader economy.