Factories Grew Again in September. The Prices Index Jumped 6.8 Points to 77.9%.

The Institute for Supply Management's Manufacturing PMI read 54.5% in September 2026, a tenth of a point below August. On the headline, almost nothing happened. The movement was in the components, and the largest of them by some distance was the Prices Index, which rose 6.8 points to 77.9%.

The headline barely moved

ISM Chair Susan Spence said the Manufacturing PMI registered 54.5%, 0.1 percentage point below the August figure. FXStreet reported a consensus forecast of 55, so the reading came in slightly short of expectations. ISM said the sector expanded for a ninth consecutive month and that the overall economy had expanded for 23 consecutive months, with 12 of 18 manufacturing industries reporting growth in September.

Where the movement was

• Prices: 77.9%, up 6.8 points from 71.1%.
• Backlog of Orders: 56.4%, up 4.6 points from 51.8%.
• New Orders: 55.3%, up 1.6 points from 53.7%.
• Employment: 52.7%, up 1.5 points from 51.2%.
• Production: 56.7%, down 1.6 points from 58.3%.
• Inventories: 48.6%, down 2.0 points from 50.6%.
• Supplier Deliveries: 59.0%, down 0.3 points from 59.3%.

What a prices reading of 77.9% means, and what it does not

The ISM indexes are diffusion indexes built from direction-of-change answers. A Prices Index above 50% means more survey respondents reported paying higher prices than reported paying lower ones; the further above 50%, the broader that majority. What the index does not carry is magnitude. A reading of 77.9% says input-cost increases were widespread across the purchasing managers who answered. It does not say by how much any price rose, and it is not a measure of what manufacturers charge their own customers.

The Backlog of Orders reading is worth reading next to it. Backlogs rising 4.6 points while Production fell 1.6 points describes work accumulating faster than it is being cleared, at least across the respondents in that month's sample.

Employment and inventories

The Employment Index rose to 52.7%, its second consecutive reading above the 50% line on the figures published for August and September. Inventories fell below 50%, to 48.6%, meaning more respondents reported running stocks down than building them.

This article reports published survey figures and is for informational purposes only. It is not investment advice and not a recommendation to buy or sell any security. Readers should consult the ISM Report On Business and the Bureau of Labor Statistics price indexes for primary data.