U.S. Manufacturing Grows At Slower Pace Than Previous Months

Manufacturing in the U.S. expanded in June at the slowest pace this year, as factories received fewer orders and demand from abroad slowed. The Institute for Supply Management’s manufacturing gauge fell to 56.2 last month from 59.7 in May. (A reading greater than 50 points to expansion.)

A measure of new orders dropped to the lowest level since October. However, manufacturing is easing into a more sustainable pace of growth after leading the economy out of recession. With production having already picked up, companies are facing less pressure to replenish inventories, while at the same time China’s economy has slowed and Europe continues to struggle with Greece’s debt crisis.

Other figures also showed slower manufacturing growth in China and Europe. China’s Purchasing Managers’ Index fell to 52.1 in June from 53.9 the previous month. A gauge of factory output in the 16-member euro region declined to 55.6 last month from 55.8.

The economic recovery in the U.S. is being accompanied by a labor market that’s taking time to improve and a struggling housing market. In related news, the inventory index rose to 45.8 from 45.6 in May. A figure lower than 50 means manufacturers are reducing stockpiles.