A key gauge of U.S. manufacturing activity likely rose in August, which would bring the index into positive territory for the first time since the recession began, according to a Reuters' poll of economists.
The Institute for Supply Management's manufacturing index is expected to have risen to 50.5 in August from 48.9 in July, according to a median forecast from a recent Reuters poll.
Estimates from the 78 economists polled ranged from a low of 48.9 to a high of 53.5.
A reading above 50 indicates the sector is expanding.
An expansionary reading on the nationwide ISM manufacturing index would come a day after the Institute for Supply Management-Chicago reported that its midwest business barometer rose to 50.0 in August.
The national Institute for Supply Management will release its August non-manufacturing index at 10 a.m. on Tuesday.
A sampling of forecasts and analysis on the upcoming non-manufacturing index follows:
IAN SHEPHERDSON, CHIEF U.S. ECONOMIST, HIGH FREQUENCY ECONOMICS
The Chicago PMI jumped to 50.0 from 43.4, above the consensus 48 and the highest reading since September 08. The grim state of the auto sector has held back the Chicago PMI relative to other regional surveys and the national ISM, but we think the success of the clunker program is now lifting the index. Taken together with the very strong Milwaukee PMI, also just released, and other regional surveys, we reckon the national ISM tomorrow will rise to about 51 from 48.9, marginally above the consensus 50.5 forecast.
NOMURA SECURITIES INTERNATIONAL, NEW YORK:
The ISM manufacturing index is on a path toward 50, but we believe it will remain just below the breakeven point this month. While both the Empire State and Philadelphia Fed indexes surged above zero, their ISM-weighted composite indexes posted less impressive gains. We believe the rising headline indexes for these surveys may reflect generalized confidence rather than an improvement in firms' actual activity.
MICHAEL MORAN, CHIEF ECONOMIST, DAIWA SECURITIES AMERICA:
The ISM manufacturing index has increased for seven consecutive months, making steady progress toward the critical value of 50 percent. Increases in regional manufacturing indexes suggest that the national measure reached or surpassed that threshold in August. In addition, new orders for durable goods appear to be picking up, which hints at continued improvement in the manufacturing sector.
(Polling by Bangalore Polling Unit)
(Reporting by Ellen Freilich and Camille Drummond; Editing by Dan Grebler)