ISM Commodities Survey Produces Highest Reading Since Last Summer

Includes: AGG, DIA, SPY
by: Bespoke Investment Group

Hickey and Walters (Bespoke) submit: While Tuesday's ISM report on manufacturing came in stronger than forecast (54.7 vs. 51.0), not all the news was good. As the chart below shows, the ISM commodities survey, which tracks the monthly net number of commodities rising in price, has been a good precursor to the general direction of inflation.

In this month's survey, respondents saw increases in the prices of 20 commodities and declines in none. This marks the highest reading since last Summer and also breaks the down-trend in this indicator which had been in place since late 2004, indicating that negative news on inflation could be in the cards going forward.

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ism commodities survey