From Reuters, reporting on the ISM’s report showing an expansion of manufacturing in August for the first time in 18 months, “U.S. manufacturing in recovery mode, demand a worry“:
While the recession in the broader economy may well be over, unemployment is likely to continue to mount for several months, adding to the stress in household finances and undercutting consumer spending, usually the main driver of the economy.
“Recovery is going to be modest for the next half year. I don’t think you will see an upturn in consumer spending until the labor market recovers, which will be sometime mid-next year,” said David Huether, chief economist at the National Association of Manufacturers.
New York Times, “Manufacturing Grows After 18 Weak Month“:
Companies that make textiles, paper products, computers and electronics, appliances and chemicals were among 11 industry groups that said their business had grown in August. They said new orders were flowing in, production was ticking up and their prices were rising. “It is a big deal,” said John E. Silvia, chief economist at Wells Fargo. “It does suggest that manufacturing is recovering.”
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