01 August 2012 16:53 [Source: ICIS news]
HOUSTON (ICIS)--US manufacturing contracted for the second month in a row in July, following 34 consecutive months of expansion, the Institute for Supply Management (ISM) said on Monday.
The nation’s chemicals industry was among those reporting a decline in July, while plastics industries reported a slight increase.
The ISM’s purchasing managers index (PMI) grew slightly to 49.8%, up by 0.1 percentage points from June.
However, the index was still below 50%, which marks the dividing line between an expanding and contracting manufacturing industry.
The PMI is a composite of supplier responses to the ISM’s monthly survey of 10 different business performance measures in 18 major manufacturing sectors.
Prior to June, the PMI had been above 51% for 34 of the 36 months since the end of the recession in June 2009, including a recent peak of 59.9% in January 2011.
Of the 18 manufacturing industries measured by the PMI for July, seven reported growth, including plastics and rubber products.
An unidentified plastics industry executive was quoted in the report as saying, “Resin pricing has bottomed out so customer orders have increased; it was pent-up demand.”
Eleven industries reported contraction in July, including chemical products.
“General state of business this month is flat, with increasing economic uncertainty,” an unidentified chemicals industry executive was quoted as saying.
The ISM’s subsidiary index for new orders for manufactured goods registered 48% in July, which is an increase of 0.2 percentage points from June. This represents a contraction in new orders for the second time since April 2009, when the new orders index registered 46.8%.
The plastics and rubber products industry was among only three industries that reported growth in new orders in July.
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