Board of Governors of the Federal Reserve System

Figure 1. Comparing BTOS Manufacturing Indicators to ISM and Markit

This is a multi-panel line chart with seven panels arranged in a two-column grid (Shipments, New Orders, Unfilled Orders, Supplier Delivery Times, Input Prices, Output Prices, and Employment), each spanning January 2024 through July 2026. Each panel plots up to three series: BTOS (black solid line), ISM (light-blue dashed line), and Markit (purple dotted line, where available). Markit is unavailable in Shipments, Unfilled Orders, and Employment, and ISM is unavailable in Output Prices. The panels show a horizontal reference line at 50 indicating no net change.

(1) Shipments: BTOS stays low (roughly 37–44) throughout, while ISM runs higher (about 44–59), rising toward the end. (2) New Orders: BTOS is generally highest, spiking to about 64 near January 2025 before settling into a choppy 52–60 range; ISM and Markit track more closely, mostly between 44 and 56. (3) Unfilled Orders: BTOS ranges from the high 30s to mid-40s, bottoming near 39 in early 2026 before rising to about 46; ISM runs higher, spiking to about 57 in early 2026. (4) Supplier Delivery Times: all series move closely in a 48–61 band, with ISM rising sharpest, to about 61, in mid-2026. (5) Input Prices: all three rise substantially, from the 50s–60s in 2024 to peaks near 80–85 in 2026, with ISM showing the highest peak and most volatility. (6) Output Prices: BTOS and Markit trend upward from the mid-50s to peaks near 63–64 in 2026, Markit more volatile with a dip to about 51 in mid-2024. (7) Employment: BTOS holds in a narrow 46–50 band; ISM is more volatile (about 44–53), with a sharp rise at the end.

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Figure 2. Output and Input Price Diffusion: Tariff-Exposed Subsectors vs. Total Manufacturing

This is a two-panel line chart (“Output prices” left, “Input prices” right), each spanning January 2024 through July 2026, with a “Diffusion index” y-axis from 40 to 90 and a dashed gray horizontal reference line at 50. A dotted vertical gray line in each panel marks February 2025, the tariff onset. Five series appear in both panels: Fabricated Metals (332, blue long-dash), Primary Metals (331, blue dotted), Computer & Electronic Products (334, orange dash-dot), Electrical Equipment (335, orange dash-dot with wider spacing), and Total Manufacturing (solid black).

In the output prices panel, all series hover in the mid-50s to low-60s before February 2025, with Primary Metals dipping to about 46 in mid-2024. After the tariff onset, series drift upward with more volatility — Primary Metals spikes to about 76 near early 2026 — while Total Manufacturing rises more smoothly, from about 55 to a peak near 64 in mid-2026, ending around 59. In the input prices panel, all series start clustered near 67–70 in January 2024, dip to about 64–66 by late 2024, then jump sharply right at the February 2025 line to about 73–75. Electrical Equipment and Computer & Electronic Products lead the increase, peaking near 82–85 in spring 2025, before easing to the high 60s/low 70s in late 2025 and climbing again to a second peak near 80–83 around May 2026. Total Manufacturing tracks near the middle of the group, ending at about 76 in July 2026.

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Figure 3. Effects of Tariff Exposure on Manufacturing Business Conditions

This is a coefficient (dot-and-whisker) plot showing the estimated effect of a one-standard-deviation increase in net tariff exposure on seven BTOS diffusion indices along the x-axis: Employment, Supplier Delivery Times, Input Prices, Output Prices, Shipments, New Orders, and Unfilled Orders. Each estimate is a blue dot with a blue vertical line for the 95 percent confidence interval; a dashed gray horizontal line at zero marks no effect. The y-axis, “Diffusion index (points),” ranges from -10 to 10.

Point estimates are negative for six of the seven outcomes and positive for one (New Orders). Input Prices shows the largest, statistically significant negative effect (point estimate about -4.0, confidence interval -6.1 to -1.8, entirely below zero). Output Prices is also significant and negative (-1.5, interval -2.8 to -0.2). Supplier Delivery Times shows a smaller negative estimate (about –0.9, interval -1.9 to 0). The remaining outcomes are not statistically significant, with intervals crossing zero: Employment (-0.3, interval -1.3 to 0.7), Shipments (-1, interval -3.2 to 1.2), Unfilled Orders (about -0.3, interval roughly -3.6 to 3), and New Orders, which has the widest interval and the only positive estimate (2, interval -2 to 6.1).

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