US manufacturing sector in August contracts for 10th month

By Ovunc Kutlu

ISTANBUL (AA) - The US manufacturing sector in August contracted for the 10th consecutive month, according to a report released Friday by the Institute for Supply Management (ISM).

The ISM manufacturing purchasing managers' index (PMI) came in at 47.6% last month -- 1.2 percentage points higher than the 46.4% recorded in July.

While a reading above 50 indicates growth, one below that shows contraction.

The market expectation for the index, based on replies from purchasing and supply executives in more than 400 industrial firms, was to come in at 47.0% in July.

"The U.S. manufacturing sector shrank again, but the uptick in the PMI indicates a slower rate of contraction," said Timothy Fiore, the chair of ISM Manufacturing Business Survey Committee. "Of the six biggest manufacturing industries, three — Transportation Equipment; Food, Beverage & Tobacco Products; and Petroleum & Coal Products — registered growth in August."

The new orders index failed to leave the contraction zone in August, recording a 12th consecutive month in that territory, by coming in at 46.8% -- 0.5 percentage points lower than 47.3% in July.

The production index in August posted a reading of 50%, which was a 1.7 percentage point increase from July's figure of 48.3%.