- U.S. Manufacturing Grows at Fastest Pace in 13 Years
U.S. Manufacturing activities grew at the fastest pace in 13 years in September.
Manufacturing activities rose to 60.8 in September from 58.8 in July, according to the Institute for Supply Management report released on Monday. This is higher than the 58.1 predicted by economists and the fastest since May 2004. Readings above 50 indicate expansion.
New orders increased from 60.3 in July to 64.6 in September, the highest in seven months and an indication of growing consumer confidence.
Job creation in the manufacturing sector stood at 60.3 in September, up from 59.9 recorded in July. Also, the best in more than six years. This data further validated the healthiness of the US labor market and improved new job creation even with the Hurricanes.
Similarly, prices jumped to 71.5 in September from 62 in the preceding month. The highest in more than six years. This gain in prices will boost the overall headline inflation rate towards the Federal Reserve’s 2 percent target in September and increase the odds of the apex bank raising rates one more time this year as investors look to the commencement of balance sheet normalization.
While the manufacturing sector has steadily grown for the last two years on the back of growing consumer spending and increase investment in the economy. The improved exports due to the weak U.S. dollar help broaden growth.
According to the report, oversea orders rose from 55.5 in July to 57 in September, while manufacturing production jumped to three-month high of 62.2 in September from 61.
In a separate report released on Monday by the Commerce Department, construction spending rose 0.5 percent to $1.21 trillion in September and 2.5 percent Year-on-year.
The US dollar gained 0.66 percent against the Euro single currency to $1.1736 at 11:11 am New York time.