The prices increased significantly by 12.2 to 77.6 because of much higher freight costs and the producers switched to using more local raw materials. This also impacted the supplier’s deliveries by +5.9 to 67.6 as a higher number indicated slower deliveries.
http://sg-stock.blogspot.com/2020/12/the-us-inflation-is-coming-part-2.html
The producers increased their production (64.8, +4) and employment (51.5, +3.1) to prepare for a rebound in the customers’ inventories (37.9, +1.6) which was too low because the inventories were depleted by an increasing new order (67.9, +2.8) that was supported by the government’s stimulus aids.
All these resulted in the PMI increased to 60.7 (+3.2). This means that the US economy will continue to improve unless there is another major lockdown due to the new covid variant. However, the US has to watch out for higher inflation because of the rising freight costs and PPI prices as the US may do QE tapering to contain its inflation.
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