ISM Manufacturing Index Definition. The ISM Manufacturing Index is released monthly by the Institute of Supply Management. It is an index that assesses the state of the U.S. manufacturing sector by surveying executives on expectations for future production, new orders, inventories, employment and deliveries. This data is considered a very important and is a trusted economic measure. Values over 50 generally indicate an expansion of the economy, while values below 50 indicate a decrease in economic activity and may signal a recession, especially if trends last more than a few months. There is also a corresponding index for the remaining 80% of the economy that surveys service company executives. It is called the ISM Non-Manufacturing Index. Similar correlations indicate expansions and/or contractions in the market.
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