Data shows US economy expanding

| May 1, 2006 | 0 Comments

New data on a number of measures of the US economy were released on Monday, showing that the economy continues to grow. Construction spending, personal income and personal spending were all up, as was manufacturing.

The Institute for Supply Management said that its manufacturing index was up to 57.2 in April, surpassing March’s 55.2. The increase was unexpected, with most analysts expecting that the index would decline slightly to 55.0 during the month. It was the 55th month in row of growth for the index, in which a level of 50 or more indicates growth and a level under 50 signaling contraction in the sector.

A report from the US Commerce Department showed that construction spending in March was up to $1.199 trillion on an annualized basis, up 0.9 percent from February and exceeding the jump of 0.3 percent that had been predicted. The spending was spread out among a number of project types, including private spending on factories and residences as well as on government public works projects.

The Commerce Department also said in a separate report that personal income rose by 0.8 percent in March, well above the 0.2 percent increase in February and the largest single-month gain since last September. The income measured by the report included both wages, which grew by 0.4 percent, and government payments. In conjunction with higher income, personal spending was up 0.6 percent in March after a gain of only 0.2 percent in February. These numbers are not adjusted for inflation; with that adjustment made, consumer spending was up a slightly smaller 0.2 percent in March, the same as it had been in February.

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