U.S. manufacturing activity surged close to it’s a 4 ½ -year high this month while industrial employment rose, indicating the economy is growing stronger in the third quarter.
Another report released on Tuesday indicated that services and factory sectors expanded in certain parts of the country. However, the housing market still remains weak.
“The rest of the economy continues to deliver the goods, but the housing market is still not performing as everybody thought it would and that’s going to take some time,” Eugenio Aleman, a Charlotte, North Carolina-based senior economist at Wells Fargo Securities, told Reuters.
Financial research firm Markit announced that its “flash” or initial factory purchasing managers index stood at 57.9, the same as in August when it rose to its strongest level since April 2010. Any measure above 50 indicates growth in manufacturing, which accounts for 12 percent of U.S. economic output.
Factory employment increased for the second consecutive month, with an index of job market conditions rising to its strongest since March 2012. A gauge of fresh orders stood above 60 point for the third time over the past four months, indicating the demand for manufactured goods remains persistent.
The third quarter factory activity was the highest since Markit started monitoring it in mid-2007.
In a separate report, the Federal Reserve Bank of Richmond announced that its regional manufacturing gauge jumped this month, as factories reported an increase in new orders and deliveries. It also reported that businesses in the zone, which stretches from the Eastern seaboard from Maryland to South Carolina, employed more workers and added extra working hours, though wages slowed down. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
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