Manufacturing Association Sees More Evidence of Strengthening Recovery
Press release from the issuing company
WASHINGTON, D.C., March 19, 2002 – The Commerce Department report indicating that new orders for manufactured goods rose 1.6 percent in January, following a more modest 0.7 percent rise in December, is the third recent statistic indicating that a broad-based recovery in manufacturing may be in the works, said National Association of Manufacturers chief economist David Huether referencing the March 6th report.
“(the) release, which shows that shipments of both durable and nondurables accelerated in January, is notable for its dispersion,” Huether said. “Excluding transportation, which I expected to rise as automakers rebuild stocks following historically strong sales in the 4th quarter, both orders and shipments rose at a healthy pace of 1.2 and 1.8 percent respectively.
“Thankfully, today’s report reflects only a modest downward revision to the preliminary report on January durable goods orders that came out last week,” Huether said. “When combined with the February ISM report that manufacturing activity expanded last month, today’s release offers persuasive evidence that the industrial sector is gaining momentum.
“Inventories continue to be worked off, though at slower rate of -0.6 percent compared to the two previous monthly declines that averaged -1.1 percent,” Huether said. The inventory correction is over in the auto sector and the overhang in the rest of manufacturing is moderating significantly.
“However, due to a weak profit picture, an over-valued dollar and sluggish growth abroad, I expect the recovery to be modest during the first half of 2002, with manufacturing output growing at an annual rate of roughly 2 percent during the first six months of 2002,” Huether concluded.
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