Purchasing Managers’ index drops again   

The Institute of Supply Management reported that the Purchasing Managers' Index (PMI) lost 0.8 points to 50.8 in October from 51.6 in September. This represents 27 consecutive months of growth, but represents four straight months perilously close to 50. A PMI over 50 indicates growth while a PMI under 50 indicates contraction in the manufacturing sector of the economy. The index reached a low of 32.5 in December 2008 but then recovered more quickly than other areas of the economy. Manufacturing has been a bright spot in the economy and the dramatic drop in the last few months is certainly a cause for concern about where the economy is headed for the balance of 2011 and into 2012. The vertical bars in the graph represent recessions.