US manufacturing output beats expectations in January

The latest survey from the Institute for Supply Management (ISM) has revealed a rise in US factory output.

According to the ISM, the manufacturing activity index rose to 60.8 in January, from December’s 58.5.

The reading, which was the highest since May 2004, was better than analysts expected and drove US stocks up to a 2½-year high.

Furthermore, the index continues to stay above the crucial 50 mark, which indicates expansion and has been at this level for 18 consecutive months.

Meanwhile, new orders - an indicator of future growth - also rose to 67.8 in January, from 62 the previous month, while the index’s employment component reached a level not seen since April 1973.

Norbert Ore, chair of ISM, comments: “The continuing strong performance is highlighted as January is also the sixth consecutive month of month-over-month growth in the sector. New orders and production continue to be strong.”

The figures come as manufacturing figures have appeared strong in other major economies. China, the euro zone and the UK all reported positive manufacturing data for the month of January.

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