NEW YORK – The nation's manufacturing sector extended its growth streak to a fourth consecutive month in May, overcoming worries about inflation, soaring gas prices and the broader economy's sluggishness, a research group said Friday.
The Institute for Supply Management said its manufacturing index registered 55, above the April reading of 54.7 and higher than the market expectation of 54.
The reading was the highest in a year. It was 54.7 in May 2006.
A reading above 50 indicates growth while a reading below 50 indicates contraction.
Manufacturers are ramping up production to make up for caution early in the year, said Brian Bethune, an economist with Global Insight.
"They were pessimistic early in the year, and inventory levels got too low. What we're seeing now is the classic whipsaw effect," he said.
New orders and production grew; the index for new orders rose to 59.6, up from 58.5 in April. Production jumped to 58.3 from 57.3.
The top performing industries, in order of growth, were nonmetallic mineral products; fabricated metal products; food, beverage and tobacco; chemical products; petroleum and coal; computer and electronic products; miscellaneous manufacturing; transportation equipment; machinery; wood products; textile mills; and electrical equipment, appliances and components.