The Associated Press
WASHINGTON (AP) â¿¿ U.S. manufacturing likely kept growing for a fourth straight month in March, adding to other signs of improvement in the economy.
Economists forecast that the Institute for Supply Management's manufacturing index will slip to 54.0, down from 54.2 in February. Readings above 50 indicate expansion.
The ISM will release the report at 10 a.m. EDT Monday. The ISM is a trade group of purchasing managers.
The February report was surprisingly strong. Manufacturing grew at the fastest pace since June 2011. The improvement was broad-based, too: 15 of the 18 industries tracked by the survey showed growth.
New orders rose to the highest level since April 2011, production increased to a 10-month high and factories added jobs. Export orders rose, despite Europe's ongoing recession and slower growth in China. And order backlogs increased for the first time in a year, a sign manufacturers can't keep up with demand.
Factory output could rise in the coming months. The February ISM survey showed businesses ramped up their orders for industrial machinery, electrical equipment and other capital goods. That suggested they are confident about their future growth.
The economy has proven surprisingly resilient in the face of tax increases that took effect in January and federal budget cuts that began to kick in March 1.
The government reported Friday that U.S. consumers increased spending in February as their incomes jumped. The University of Michigan's consumer sentiment index showed that Americans were feeling more confident about the economy at the end of March.
Underlying the improvement is a strengthening job market. Employers have been adding 200,000 jobs a month since November, twice the pace from last spring. Unemployment fell in February to 7.7 percent, lowest since December 2008.
The economy grew at a sluggish 0.4 percent annual pace from October through December last year. Economists expect growth picked up to an annual rate of 3.0 percent in the current quarter, helped by the jump in consumer and business spending.