Manufacturing picks up in October; input prices stay high

U.S. manufacturing activity strengthened in October, with the Institute for Supply Management’s manufacturing PMI rising to 55.5 from 54.5 in September, beating a Reuters forecast of 54.5. The index has held above the 50-point growth threshold this year, supporting the idea that factory output is expanding, in an economy sector representing about 9.4%. Orders and exports both edged higher, while inventories increased. Supply pressures remain: supplier deliveries slowed only slightly, and factories continued to pay elevated prices, even as the prices-paid index eased to 75.2 from 77.9. Economists expect inflation to stay above the Fed’s 2% target into 2027.