US factory activity grows at slower pace
Source: Agencies |
April 2, 2013, Tuesday
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Print Edition
Print Edition
A SURVEY shows US manufacturing activity expanded more slowly in March than February, held back by weaker growth in production and new orders. But factories hired at the fastest pace in nine months, an encouraging sign ahead of Friday's report on March employment.
The Institute for Supply Management said yesterday its index of factory activity slipped to 51.3 percent. The index fell from 54.2 percent in February, which was the fastest growth since June 2011.
A reading above 50 indicates expansion. The index has signaled growth for four straight months. But the drop in March growth was bigger than economists expected.
Jennifer Lee, senior economist at BMO Capital Markets, said in a note to clients that the March decline might be the first sign that companies are worried about federal spending cuts that took effect on March 1.
But Joshua Shapiro, chief US economist at MFR Inc, cautioned that the index's drop last month might just be a one-month blip. Combined, the ISM reports for the first three months of 2013 "suggest that the manufacturing sector is now making moderate headway."
In addition to faster hiring, new export orders grew faster in March than February.
The ISM said the index was consistent with an annual rate of economic growth of 3.3 percent from January through March, up from a tepid 0.4 percent growth rate the last three months of 2012.
Reports yesterday showed manufacturing is on the upswing in China and Japan, the second- and third-largest economies in the world.
The Institute for Supply Management said yesterday its index of factory activity slipped to 51.3 percent. The index fell from 54.2 percent in February, which was the fastest growth since June 2011.
A reading above 50 indicates expansion. The index has signaled growth for four straight months. But the drop in March growth was bigger than economists expected.
Jennifer Lee, senior economist at BMO Capital Markets, said in a note to clients that the March decline might be the first sign that companies are worried about federal spending cuts that took effect on March 1.
But Joshua Shapiro, chief US economist at MFR Inc, cautioned that the index's drop last month might just be a one-month blip. Combined, the ISM reports for the first three months of 2013 "suggest that the manufacturing sector is now making moderate headway."
In addition to faster hiring, new export orders grew faster in March than February.
The ISM said the index was consistent with an annual rate of economic growth of 3.3 percent from January through March, up from a tepid 0.4 percent growth rate the last three months of 2012.
Reports yesterday showed manufacturing is on the upswing in China and Japan, the second- and third-largest economies in the world.
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