02 January 2009 16:24 [Source: ICIS news]
TORONTO (ICIS news)--US manufacturing industry activity fell further into decline in December, dropping to a 28-year low as the overall economy contracted for the third consecutive month, the Institute for Supply Management (ISM) said on Friday.
The institute’s closely watched purchasing managers index (PMI) fell from 36.2% in November to 32.4% in December, the lowest reading since June 1980 when it was 30.3%, it said.
A PMI reading of 50% or higher indicates that manufacturing industries - key downstream consuming sectors for chemicals - are experiencing growth. A reading below 50% means that the broad manufacturing sector is in contraction.
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“Manufacturing activity continued to decline at a rapid rate during the month of December,” he said.
“The decline covers the full breadth of manufacturing industries, as none of the industries in the sector report growth at this time,”
New orders have contracted for 13 consecutive months, and were at the lowest level on record since January 1948, he said.
The ISM’s new orders index registered 22.7% in December, 5.2 percentage points lower than the 27.9% in November.
“Manufacturers are reducing inventories and shutting down capacity to offset the slower rate of activity,”
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