Manufacturing activity in the US shrank for the fourth straight month in June while construction fell unexpectedly during May, according to reports out today. The Institute for Supply Management (ISM) said its index of manufacturing activity rose to 49.8 in June from 49.4 in May. Any number below 50 indicates contraction in the sector. Economists had expected the index to rise to 51. Despite the continuing falloff in growth in the sector, the report said that US factories were poised for a recovery in the second half. US manufacturing makes up around one sixth of the national economy but has experienced a slump lasting over two years.
Meanwhile, US construction spending fell an unexpected 1.7pc in May, the biggest drop in a year as spending on residential construction fell to its lowest level since November, according to a report from the Commerce Department. Construction outlays fell to a seasonally adjusted USD869.8bn in May. Analysts had been expecting a 0.4pc increase. Residential construction fell 0.9pc, the third consecutive monthly decline, to an adjusted annual rate of USD445.4bn. Non-residential construction fell 0.4pc and public building slid 1.8pc. //www.fxcentre.com