The ISM manufacturing PMI climbed to 54.0 in May 2026, its highest level since May 2022 and above the 53.0 consensus estimate, marking five consecutive months of expansion. The prices paid index stood at 82.1, with aluminum and steel shortages maintaining strong margin pressure despite a retreat from April’s 84.6. Factory employment contracted for the 32nd consecutive month, representing nearly three years of uninterrupted workforce shrinkage. The US-Iran conflict disrupted shipments through the Strait of Hormuz, cited by 42% of surveyed manufacturers, while 57% of respondents were affected by tariff-related price volatility. Analysts warn this surge may prove temporary, as front-loaded orders risk unwinding once inventory restocking is complete.
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