ISM Index Steady at 61.2% in March

NEW YORK (TheStreet) -- Economic activity in the manufacturing sector continued to expand at a steady pace in March, but companies continue to feel the pressure of rising input costs.

The Institute for Supply Management said the Purchasing Managers Index registered 61.2% in March, more or less unchanged from the 61.4% in February and in line with expectations.

Production expanded at a faster pace, though new orders and order backlogs showed a slowdown.

Of concern was the continuing increase in the prices index to 85 from 82 in February, suggesting that higher commodity prices are still weighing on manufacturers. The employment index also dropped 1.5 to 63.

"While manufacturers are benefiting from strength in new orders and production, there is significant concern with regard to commodity prices. Many manufacturers indicate the prices they have to pay for inputs are rising, and there is concern about the impact of higher prices on their margins," said Norbert J. Ore, chair of the ISM

In another report, the Commerce Department said construction spending dropped more than expected by 1.4% in February, after declining 0.7% in February. The February figure is 6.8 percent below the February 2010 estimate of $815.8 billion.

--Written by Shanthi Bharatwaj in New York



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