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U.S. Factory Activity Picks Up
American manufacturing activity expanded in August at the fastest pace in more than two years, according to the Tempe, Ariz.-based Institute for Supply Management.
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American manufacturing activity expanded in August at the fastest pace in more than two years, according to the Tempe, Ariz.-based Institute for Supply Management.
The research group's manufacturing index rose to 55.7 last month from 55.4 in July. Any reading above 50 indicates expansion. In ISM's latest survey, 15 of 18 industries reported growth.
New orders jumped nearly five points to 63.2, the highest level since April 2011. Customer inventories dropped by a similar amount, which could mean growth in coming months as companies restock.
But ISM's production index slid 2.6 points to 62.4, and factory employment declined slightly. Raw materials prices jumped 5 points month over month to 54.0%. Economists say that increase could pinch the profits of manufacturers unless they pass along higher costs to consumers, thus stoking inflation.
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