Open

Coming up

Don't miss

Replay


LATEST SHOWS

FOCUS

Bastille Day: youth pays hommage to ancestors who fought 'Great War' (1914 - 1918)

Read more

TALKING EUROPE

Nigel Farage, Leader of the UK Independence Party

Read more

TALKING EUROPE

Endocrine disruptors: Is the EU doing enough to protect its citizens' health?

Read more

WEB NEWS

Israelis taking bomb shelter selfies

Read more

THE INTERVIEW

Pavlo Klimkin, Ukrainian Foreign Minister

Read more

THE INTERVIEW

Raed Fahmi, former Iraqi Minister of Science and Technology

Read more

IN THE PAPERS

Germany's World Cup title

Read more

FASHION

Paris, Haute Couture Fall/Winter 2014-2015

Read more

BUSINESS DAILY

Farnborough air show takes off but F-35 jet is grounded

Read more

  • Boules and booze: Bastille Day à la New Yorkaise

    Read more

  • Shipwrecked Costa Concordia successfully refloated

    Read more

  • Alberto Contador out of Tour de France after crash

    Read more

  • In pictures: 2014 World Cup historic moments

    Read more

  • France commemorates WWI centenary on Bastille Day

    Read more

  • Paris’s Bastille Day fireworks ‘a homage to victims’ of WWI

    Read more

  • Germany defeat Argentina 1-0 to win fourth World Cup title

    Read more

  • Kremlin mulls 'retaliatory strikes' after death of Russian civilian

    Read more

  • Senegal honours the soldiers who fought for France in WWI

    Read more

  • Clashes erupt in Paris as thousands march to support Palestinians

    Read more

  • Thousands flee northern Gaza after Israeli warning

    Read more

  • Major differences remain as deadline looms in Iran nuclear talks

    Read more

  • Rival Libyan militias exchange heavy fire at Tripoli airport

    Read more

  • French military to extend Mali 'counterterrorism' operations into Sahel

    Read more

Business

Manufacturing sector grows for first time in 18 months

©

Text by NEWS WIRES

Latest update : 2009-09-01

The Institute of Supply Management has published its monthly factory growth index showing a four point progression in August. It's the first growth in 18 months and is yet another possible sign that the US economy is recovering.

AFP - The US manufacturing sector grew in August after 18 consecutive monthly declines, a survey from the Institute of Supply Management showed Tuesday.
  
The Institute of Supply Management said its index of the factory sector, also known as the purchasing managers index, jumped to 52.9 percent from 48.9 percent in July. Any number above 50 indicates growth.
  
The figure was stronger than the average economist estimate of 50.5 percent and positive news for an economy struggling to emerge from a sharp recession that began in December 2007.
  
"The year-and-a-half decline in manufacturing output has come to an end, as 11 of 18 manufacturing industries are reporting growth when comparing August to July," said ISM survey chief Norbert Ore.
  
"While this is certainly a positive occurrence, we have to keep in mind that it is the beginning of a new cycle and that all industries are not yet participating in the growth."
  
The manufacturing sector has been showing signs of emerging from its slump even as US consumer spending has been sluggish and unemployment has been rising.
  
The details of the ISM survey showed strong gains in orders even though employment continued to decline.
  
The new orders sub-index jumped to 64.9 percent in August from 55.3 percent, indicating faster growth, the ISM said. Similarly, the production index increased to 61.9 percent from 57.9.
  
The employment index rose to 46.4 percent from 45.6 percent, suggesting industries are still cutting jobs but at a slower pace.
  
Manufacturing has been emerging from its slump as companies replenish stockpiles from big production cuts over the past few months, and from a resurgence in auto sales, lifted by government incentives in the "Cash for Clunkers" program.
  
"We think the auto clunker program is responsible for this surge in activity, plus some improvement in export sales," said Ian Shepherdson, chief US economist at High Frequency Economics.
  
"Remember, there is no strength in domestic consumption to keep it rising."
  
Daniel Meckstroth, chief economist for the Manufacturers Alliance, said activity "is being driven by a classic inventory swing, particularly in the automotive sector."
  
"It is less that inventories are being added as it is that firms are not destocking. Production, therefore, has to rise as fewer products and materials come out of inventories," Meckstroth said.
  
The ISM said 11 of the 18 manufacturing industries reported growth in August.
  
These included textiles; apparel and leather products; paper products; miscellaneous manufacturing; printing and related activities; computer and electronic products; transportation equipment; nonmetallic mineral products; electrical equipment, appliances and components; fabricated metal; and chemicals.
  
The six industries reporting contraction in August were primary metals; plastics and rubber; furniture; wood products; food, beverage and tobacco; and machinery.

Date created : 2009-09-01

Comments

COMMENT(S)