NAPM Index Reflects Continued Softening In U.S. Manufacturing

ByBridgeNews A key barometer of the health of the U.S. manufacturing economy continued to fall in December, indicating that growth in the sector contracted, and the manufacturing industry continues to head toward a technical recession. The National Assn. of Purchasing Management (NAPM) said its index of economic activity was at 43.7 in December from 47.7 in November. The December level was much lower than the 47.0 that economists had forecast, and was the lowest reading since April 1991 when the index stood at 42.9. December marked the fifth month the main index slid below the 50.0 boom-or-bust level, showing that the manufacturing sector continues to contract. Technically, the manufacturing sector would be in a recession if this index remains below 50.0 for two quarters or six straight months. The NAPM said the manufacturing index's price component, which measures how much producers pay for materials, rose to 61.0 in December from 56.6 in November. This was higher than the 55.0 forecast by economists and suggests that inflationary pressures at the manufacturing level continue to fall.