TEMPE, Ariz.—Experts from the Institute for Supply Management (ISM) remain cautiously optimistic about a possible economic recovery later this year, as two key ISM reports released today offer both a snapshot of the current situation and a forecast for the rest of 2009.
Norbert Ore, chair of ISM’s manufacturing business survey committee, and Anthony Nieves, chair of ISM’s non-manufacturing business survey committee, both talked to SCMR about ISM’s report on the non-manufacturing sector for April, and ISM’s semi-annual economic forecast for 2009.
According to the April report, the Non-Manufacturing Index (NMI) rose 2.9 points to 43.7 percent. Like the PMI in ISM’s manufacturing report issued on Friday, the NMI is edging toward 50 percent, above which it won’t be considered “in decline.”
Still, while he acknowledged the rate of decline is slowing, Nieves was cautious about celebrating too soon, as the NMI still shows a decline. With only a month of positive change, Nieves said “It’s still premature” to declare the economy in recovery.
Nieves said he and Ore both believed some sort of recovery would take place in 2009, but Nieves won’t be satisfied it’s actually happening until the NMI goes above 50.
It also needs to stay there. Nieves pointed out that in January and February of 2008, the NMI showed a decline, and it then went above 50 in March, only to drop back down in April, and it hasn’t recovered since.
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