The ISM Manufacturing PMI rose to 52.6 in January from 47.9 in December (+4.7 pts MoM), ending a year-long contraction and indicating faster overall improvement in factory conditions.

• The New Orders Index surged to 57.1 from 47.4 (+9.7 pts MoM), the highest since February 2022, showing demand turned expansionary, with the report noting post-holiday reordering and some buying ahead of expected tariff-related price increases.

• The Production Index increased to 55.9 from 50.7 (+5.2 pts MoM), the strongest reading since February 2022 and a third straight month of expansion, reflecting stronger output growth.

• The Employment Index improved to 48.1 from 44.8 (+3.3 pts MoM) but remained in contraction for a 28th month, indicating headcount reductions are still more common than hiring.

• The Supplier Deliveries Index rose to 54.4 from 50.8 (+3.6 pts MoM), signaling slower deliveries for a second consecutive month, consistent with tightening supply performance as activity improves.

• Inventories edged up to 47.6 from 45.7 (+1.9 pts MoM) but stayed in contraction, while Customers’ Inventories fell to 38.7 from 43.3 (-4.6 pts MoM) and remained “too low,” which the report links to the rebound in new orders and backlogs.

• The Prices Index increased to 59.0 from 58.5 (+0.5 pts MoM), extending rising input costs to 16 straight months, while New Export Orders returned to expansion at 50.2 (+3.4 pts MoM) and Imports rebounded to 50.0 (+5.4 pts MoM), ending a prolonged contraction phase.