Text Box: With a reading of 53.9, the MBI showed that the metalworking industry fell to its third slowest rate of growth since the most recent expansion began in August 2009. Also, this is the third straight month that the pace of growth in metalworking has slowed. The most significant reason for the slowing growth is contraction in new orders and backlog. For the first time since July 2009 new orders at metalworking facilities contracted. Contraction in new orders combined with continued robust growth in production led to the contraction in backlogs in August. There has been only one other contraction in backlogs since August 2009. The contraction in these two sub-indices could be a leading indicator that the total MBI will show the metalworking industry is contracting in upcoming months. The other four sub-indices (production, employment, exports, and supplier deliveries) all indicated growth in August, and all of these sub-indices indicated accelerating growth except for supplier deliveries. While last month saw a record high in future business expectations, those expectations cooled in August. Expectations are at the low end for the most recent expansion but still significantly above the average since the inception of the MBI. Finally, expectations for future capital spending fell slightly in August, which could be a further sign that metalworkers are growing more cautious.
Sub-Indices August July Percentage Point Change   Direction Rate of Change Trend (Months)
New Orders 47.1 56.3 -9.2   Contracting From Growing 1
Production 61.8 53.2 8.7   Growing Faster 13
Employment 61.8 50.0 11.8   Growing From Flat 1
Backlog 47.1 59.4 -12.3   Contracting From Growing 1
Exports 53.0 50.0 3.0   Growing From Flat 1
Supplier Deliveries 53.0 68.8 -15.8   Lengthening Less 5
Material Prices 58.8 53.1 5.7   Increasing More 9
Prices Received 47.1 46.9 0.1   Decreasing Less 2
Future Business Expectations 76.5 87.5 -11.0   Improving Less 15
               
Overall MBI 53.9 56.3 -2.4   Growing Slower 13
 
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