The overall economy grew for the ninety-second straight time, while the manufacturing sector expanded for the fifth consecutive month, the Institute for Supply Management reported Wednesday.
According to the ISM's monthly report on business, the ISM index increased to 56.0 in January from 54.5 in December.
Economists polled by Thomson Reuters predicted the index would be 55.0.
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 69.0 from 55.5. The employment index grew to 56.1 from 52.8.
The production index climbed to 61.4 from 59.4, the new orders index rose to 60.4 from 60.3; the supplier deliveries index grew to 53.6 from 53.0; the export orders index decreased to 54.5 from 56.0; and the imports index dipped to 50.0 from 50.5.
The inventories index climbed to 48.5 from 47.0; the customers' inventories index slid to 48.5 from 49.0; and backlog of orders also crept to 49.5 from 49.0.
Respondents' comments included:
"Demand very steady to start the year." (Chemical Products)
"January revenue target slightly lower following a big December shipment month." (Computer & Electronic Products)
"Strong start to the new year. Production is increasing and we are adding capacity." (Plastics & Rubber Products)
"Business looks stronger moving into the first quarter of 2017." (Primary Metals)
"Economic outlook remains stable and no current effects of geopolitical changes appear to be penetrating market conditions." (Food, Beverage & Tobacco Products)
"Sales bookings are exceeding expectations. We are starting to see supply shortages in hot rolled steel due to the curtailment of imports." (Machinery)
"Year starting on pace with Q4 2016." (Transportation Equipment)
"Business conditions are good, demand is generally increasing." (Miscellaneous Manufacturing)
"Conditions and outlook remain positive. Raw material prices are stable resulting in stable margins. Asset utilization remains high." (Petroleum & Coal Products)
"Steady demand from automotive." (Fabricated Metal Products)
