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Manufacturing down first time in 3 years
by Christopher S. Rugaber - Jul. 2, 2012 06:22 PM
AP Economics Writer
WASHINGTON -- U.S. manufacturing shrank in June for the first time in nearly three years, adding to signs that economic growth is weakening.
Production and exports declined, and the number of new orders plunged, according to a monthly report released Monday by the Institute for Supply Management.
The slowdown comes as U.S. employers have scaled back hiring, consumers have turned more cautious, Europe faces a recession and manufacturing has slowed in big countries like China.
The trade group of purchasing managers said its index of manufacturing activity fell to 49.7. That's down from 53.5 in May. And it's the lowest reading since July 2009, a month after the Great Recession officially ended. Readings below 50 indicate contraction.
Economists said the manufacturing figures were consistent with growth at an annual rate of 1.5 percent or less. That would be down from the January-March quarter's tepid annual pace of 1.9 percent.
"Our forecast that the U.S. will grow by around 2 percent this year is now looking a bit optimistic," said Paul Dales, an economist at Capital Economics.
Read more: Manufacturing down first time in 3 years
Read more: Manufacturing down first time in 3 years
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