02.06.2014 19:55:07
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Corrected Data Shows Manufacturing Activity Grew At Faster Rate In May
(RTTNews) - After dealing with a series of technical glitches, the Institute for Supply Management released a revised report on Monday showing a slight acceleration in the pace of growth in the U.S. manufacturing sector in the month of May.
The revised report showed that the ISM's purchasing managers index inched up to 55.4 in May from 54.9 in April, with a reading above 50 indicating growth in the manufacturing sector. The latest reading was nearly in line with economist estimates of 55.5.
Due to a software error that applied last month's seasonal adjustment factor to this month's data, the ISM originally said the index dropped to 53.2 in May, indicating a slowdown in the pace of growth.
Bradley Holcomb, chair of the ISM Manufacturing Business Survey Committee, said, "We apologize for this error. We have recalculated and confirmed that the actual index indicates that the economy is accelerating."
"Our research team is analyzing our internal processes to ensure that this doesn't happen again," he added. "We are committed to maintaining the integrity of this report."
The increase by the headline index was partly due to faster growth in new orders, with the new orders index climbing to 56.9 in May from 55.1 in April.
The production index also surged up to 61.0 in May from 55.7 in April, indicating a substantial acceleration in the pace of growth.
Meanwhile, the report showed a modest slowdown in the pace of job growth in the manufacturing sector, as the employment index dipped to 52.8 in May from 54.7 in April.
"Comments from the panel reflect generally steady growth, but note some areas of concern regarding raw materials pricing and supply tightness and shortages," Holcomb said.
The report showed that the prices index jumped to 60.0 in May from 56.5 in April, suggesting a notably faster rate of price growth.
Wednesday morning, the ISM is scheduled to release a separate report on activity in the service sector in the month of May. Economists expect the index of service sector activity to tick up to 55.5 in May from 55.2 in April.