The overall economy grew for the ninety-first straight time, while the manufacturing sector expanded for the fourth consecutive month, the Institute for Supply Management reported Tuesday.
According to the ISM's monthly report on business, the ISM index increased to 54.7 in December from 53.2 in November.
Economists polled by Thomson Reuters predicted the index would be 53.5.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion. A reading of 50 shows the sector was unchanged in the month.
The prices paid index rose to 65.5 from 54.5. The employment index grew to 53.1 from 52.3.
The production index climbed to 60.3 from 56.0, the new orders index rose to 60.2 from 53.0; the supplier deliveries index slid to 52.9 from 55.7; the export orders index increased to 56.0 from 52.0; and the imports index held at 50.5.
The inventories index slipped to 47.0 from 49.0; the customers' inventories index remained at 49.0; and backlog of orders also stayed at 49.0.
Respondents' comments included:
"Ramping up for year-end by reducing inventory." (Chemical Products)
"Very strong month in terms of booking and billing which will contribute to a good overall year revenue-wise." (Computer & Electronic Products)
"Our business remains strong and we are seeing continued growth." (Plastics & Rubber Products)
"We have been fairly steady the last few months and it appears business is strong into the 1st quarter of next year." (Primary Metals)
"Moving into [a] more inflationary environment, with lots of pressure to increase prices on a number of fronts." (Food, Beverage & Tobacco Products)
"Business continues to be brisk with an uptick of RFQs. Customers are earmarking funds for capital equipment upgrades." (Machinery)
"Hiring still tight on available local labor. Business, by segments, still uneven. Some consumer markets very (seasonally) strong, but industrial markets lagging." (Transportation Equipment)
"Business conditions are good, demand is growing." (Miscellaneous Manufacturing)
"Continued strong demand for product and strong forecast for next year." (Nonmetallic Mineral Products)
"December 2016 is way ahead of December 2015." (Fabricated Metal Products)
