The U.S. manufacturing sector expanded in August for the first time in 19 months, adding to evidence that the recession is ending. The Institute for Supply Management (ISM) said Tuesday its manufacturing index rose to 52.9 last month from 48.9 in July. It was the first reading above 50, which reflects expansion, since January 2008. New orders jumped almost 10 percentage points to 64.9 in August, the highest level since late 2004. With strong new orders for two consecutive months, production should grow at “reasonable rates” for the rest of the year, ISM economist Norbert Ore said. A weaker U.S. dollar also helped exports grow for the second consecutive month, after shrinking for nine months, the report said. Businesses believe their customers' inventories are still too low, and restocking supplies could help boost production later this year, it said.
