PRESIDENT&CEO Magazine: Manufacturing, Housing Probably Improved: U.S. Economy Preview

Manufacturing, Housing Probably Improved: U.S. Economy Preview
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Lisa Hirata on 05/21/2012 04:08:00

Manufacturers probably received more orders in April and home sales rose, a sign
the U.S. expansion is still on track, economists said before reports this week.

Factory bookings for long-lasting goods rose 0.3 percent last month after
falling 3.9 percent in March, according to the median forecasts of 61 economists
surveyed by Bloomberg News before a May 24 Commerce Department report. Other
figures may show purchases of existing and new houses also climbed.
Manufacturers may keep forging ahead as automakers crank out more cars and
trucks, while housing will probably benefit from record-low mortgage rates that
are making properties more affordable. Nonetheless, those industries alone will
fail to spur a pickup in growth without bigger increases in employment
throughout the economy that will propel consumer spending.
“The economy is growing, but it’s just not growing at an inspiring pace,”
said Brian Jones, a senior U.S. economist at Societe Generale in New York.
“The production numbers look OK, the housing market looks OK, the thing
we’re more concerned about is the labor market.”
A Federal Reserve report last week showed factory production rose 0.6 percent
in April. About half the gain came from auto making, which jumped 3.9 percent
following a 1.2 percent increase in the prior month.
Another measure of strength, the Institute for Supply Management’s
manufacturing index, climbed to 54.8 in April, the highest level in almost a
year, as orders picked up. Readings greater than 50 signal growth.
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