The U.S. manufacturing sector showed its strongest performance in over two years in January 2026, with the Institute for Supply Management (ISM) Manufacturing Purchasing Managers' Index (PMI) climbing to 52.6%. This figure significantly surpassed market expectations of 48.5% and represents the highest reading since August 2022, ending a streak of 26 consecutive months of contraction in the sector.
The robust data triggered a positive reaction in financial markets, including the cryptocurrency sector. Bitcoin (BTC), which had dropped to a yearly low of $75,000 the previous day, climbed 2.76% to trade around $78,565 following the PMI release. Analysts linked the move to a shift in broader market sentiment, suggesting that a strong PMI reading—indicating economic expansion—typically enhances investor risk appetite, which can benefit alternative assets like Bitcoin.
Key sub-indexes within the ISM report also showed significant strength. The New Orders Index, a leading indicator of future activity, soared to 57.1% from 47.4% in December, marking its highest level since February 2024. The Production Index reached 55.9%, continuing its growth for the third consecutive month. Susan Spence, chair of the ISM committee, attributed the recovery to improved demand conditions across the manufacturing sector.
Market commentators highlighted historical patterns. Joe Burnett, Vice President of Bitcoin Strategy at Strive, pointed out that Bitcoin has rallied following similar PMI reversals in 2013, 2016, and 2020. The current PMI reading adds to other positive macro indicators, such as steady employment growth and cooling inflation, painting a picture of a stabilizing U.S. economy—an environment often conducive to capital deployment into risk assets like cryptocurrencies.
However, some analysts urged caution regarding a direct correlation. Benjamin Cowen of Into The Cryptoverse noted that Bitcoin doesn't always move in lockstep with the manufacturing index. Despite the recent bounce, Bitcoin remains down nearly 38% from its October 2025 high of $126,080.
