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Manufacturing contracts for the fifth consecutive month

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Manufacturing contracts for the fifth consecutive month

Closely-watched manufacturing index a mixed bag.

According to the closely watched Institute for Supply Management’s Manufacturing Report on Business, economic activity in the manufacturing sector contracted in February for the fifth consecutive month.

The February PMI came in at 49.5%, an increase of 1.3 percentage points from the seasonally adjusted January reading of 48.2%. (A reading under 50% indicates contraction.)

The New Orders Index was unchanged during the month, registering at 52.5%, while the Production Index increased 2.6 percentage points to 52.8%. 

Employment remained in contraction mode, although improving somewhat during the month, as the Employment Index registered 48.5%, 2.6 percentage points above the seasonally adjusted January reading of 45.9%.

Inventories of raw materials increased to 45.0%, up 1.5 percentage points from January. Prices for raw materials fell for the 16th consecutive month, with the Prices Index coming in at 38.5%, compared to 33.5% in January.

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