Manufacturing expands at fastest pace since June

U.S. factories grew in January at the fastest pace in seven months, boosted by a rise in new orders. And builders ended a poor year for construction by spending more on homes and projects for the fifth straight month. A pair of reports released today bolster other data showing the U.S. economy started the year strong. The Institute for Supply Management, a trade group of purchasing managers, says its manufacturing index rose last month to 54.1 from 53.1 in December. Readings above 50 indicate expansion. A measure of hiring dipped, however, indicating factories are still adding jobs but at a slower pace than in December. Export orders also rose, a sign that U.S. manufacturers haven’t yet been affected by Europe’s slowing economy. Separately, the Commerce Department says spending on construction projects rose 1.5% in December, the fifth straight monthly gain. That pushed spending to a seasonally adjusted annual rate of $816.4 billion, the highest level in 20 months. The Associated Press has the full story here.