jumps on orders
U.S. factories expanded last month at the fastest pace since June 2011 on a jump in orders. The report signals that manufacturing output could strengthen in coming months.
The Institute for Supply Management, a trade group of purchasing managers, said Tuesday that its manufacturing index rose to 55.7 in August from 55.4 in July. That topped the index’s 12-month average of 52. A reading above 50 indicates growth.
A gauge of new orders rose nearly five points to 63.2, the highest level in more than two years. At the same time, production increased more slowly than in July, and factories added jobs at a weaker rate. Despite the drop, production reached its highest level in 2½ years.
The Federal Reserve will closely examine Tuesday’s report, which comes two weeks before Fed policymakers will decide whether to slow their bond-buying program.
The jobs report for August, to be released Friday, is the most important remaining economic report the Fed will consider.
rises strongly in July
Spending on U.S. construction projects rose in July, led by strong gains in housing and nonresidential projects.
Construction spending increased 0.6 percent in July compared with June when activity was unchanged, the Commerce Department reported Tuesday. The June performance represented an upward revision from an initial estimate that spending had fallen 0.6 percent.
Total construction activity rose to a seasonally adjusted annual rate of $900.8 billion in July, the strongest performance since June 2009.
The July gain reflected a 0.6 percent rise in housing construction with both single-family and apartment construction posting gains. In June, housing had fallen 0.9 percent.
Government projects fell 0.3 percent in July with state and local spending down 0.4 percent. That drop more than offset a 1.1 percent rise in the smaller federal category.
The advance in housing activity pushed residential construction to its highest level since September 2008.
A mysterious case of police officers losing control of their squad cars has been solved, leading to the recall of 355,000 Ford Crown Victorias — including the Police Interceptor version — Mercury Grand Marquis and Lincoln Town Cars.
The National Highway Traffic Safety Administration started looking into the problem a year ago after learning of cases of the steering going out on certain types of police cars. Part of the probe included a field inspection of vehicles in the Montgomery County, Md., police fleet garage near the agency’s headquarters.
The recall affects cars registered or originally sold in Connecticut, Delaware, the District of Columbia, Illinois, Indiana, Iowa, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Vermont, Virginia, West Virginia, and Wisconsin.