U.S. manufacturing index hits 3-year low
WASHINGTON — U.S. manufacturing shrank in June for the first time in nearly three years, adding to signs that economic growth is weakening.
Production and exports declined, and the number of new orders plunged, according to a monthly report released Monday by the Institute for Supply Management.
The slowdown comes as U.S. employers have scaled back hiring, consumers have turned more cautious, Europe faces a recession and manufacturing has slowed in big countries like China.
“This is not good,” said Dan Greenhaus, chief economic strategist at BTIG, an institutional brokerage. Though the report “does not mean recession for the broader economy, it is still a terribly weak number.”
The trade group of purchasing managers said its index of manufacturing activity fell to 49.7. That’s down from 53.5 in May. And it’s the lowest reading since July 2009, a month after the Great Recession officially ended. Readings below 50 indicate contraction.
Economists said the manufacturing figures were consistent with growth at an annual rate of 1.5 percent or less. That would be down from the January-March quarter’s already tepid annual pace of 1.9 percent.
“Our forecast that the U.S. will grow by around 2 percent this year is now looking a bit optimistic,” said Paul Dales, an economist at Capital Economics.
Stocks fell sharply after the report was released at 10 a.m. But investors appeared to shake off the bad manufacturing news by the end of the day. The Dow Jones industrial average recovered most of its early losses to close down just 8.7 points at 12,871. And broader indexes ended the day up.
Most economists aren’t yet predicting another recession. Though the ISM report suggests manufacturing is contracting, it typically takes a sustained reading below 43 to signal the economy isn’t growing.
CC:Read More From Source
Related ArticlesAn exhibit of proper sbobet football fat
May 21, 2013, 2013 03:03:25 AM
To keep healthy, Eating healthy is the key
May 20, 2013, 2013 10:31:15 AM
Ideas to Stay Healthy using the Healthy Cooking Appliances
May 20, 2013, 2013 04:53:02 AM
May 16, 2013, 2013 10:26:53 AM
Online Timesheet and time tracking Software
May 16, 2013, 2013 08:52:19 AM