Manufacturing up a bit, but slowing
Jul 02, 2010 (New Haven Register - McClatchy-Tribune Information Services via COMTEX) --
Copyright (C) 2010, New Haven Register, Conn.
Economic activity in the manufacturing sector expanded in June for the 11th consecutive month, but at a slower pace than the market expected, purchasing and supply executives said Thursday.
The Institute for Supply Management's Report on Business for June showed that 13 of the 18 participating manufacturing industries reported growth, yet the index fell from 59.7 in May to 56.2 last month. A reading of 50 or higher signals growth, while results below that mark indicate the sector is contracting.
Norbert J. Ore, chairman of the ISM Manufacturing Business Survey Committee, said the lower reading last month came from a slowdown in new orders and production indexes.
"We are now 11 months into the manufacturing recovery, and given the robust nature of recent growth, it is not surprising that we would see a slower rate of growth at this time. The sector appears to be solidly entrenched in the recovery," Ore said in a statement.
"Comments from the respondents remain generally positive, but expectations have been that the second half of the year will not be as strong in terms of the rate of growth, and June appears to validate that forecast."
Some survey respondents said in the report the oil spill in the Gulf would likely affect business conditions over the next few months and they expect the economy to continue to be sluggish, with orders 8 to 10 percent below last year's demand.
Executives reported corrugated containers, plastic products and steel as commodities that went up in price, while aluminum and copper were among those that dropped in cost.
The economic momentum is also slowing worldwide. Surveys released Thursday in China showed a slowdown in factories' growth as exports faltered and analysts worry that cutbacks in government lending will cool the economy's rapid rise.
Reports from Markit Economics also indicated that manufacturing sector growth in India, South Korea, Australia and Taiwan was slowing.
The industrial sector's growth also cooled slightly in the 16 countries using the euro and the United Kingdom.
The Associated Press contributed to this story. Angela Carter can be reached at 203-789-5752.
|
|