Manufacturing activities in the United States grew at the fastest pace in three years in December, signaling an accelerated recovery, the Institute for Supply Management (ISM) said Monday.
ISM, the influential trade group of purchasing executives, said its manufacturing index read 55.9 in December after 53.6 in November and higher
than economists had expected. A reading above 50 indicates growth.
The December data is the fifth straight month of expansion and the highest reading for the index since April 2006.
The ISM's manufacturing index first showed growth in August after 18 months of contraction. The index's peak in the last decade was 61.4 in May
2004. Its bottom was set at 32.9 in December 2008.
Economists said that the unexpected positive data suggest that the recovery in the U.S. manufacturing sector is gaining further strength.
But economists also said that a more sustainable recovery will depend on increasing demand from consumers and businesses, not just replenishing inventories.
Recent report showed that consumers remain cautious due to the high unemployment and tight credit.
The U.S. economy entered a recession in December 2007. In the July-September quarter, the overall economy grew at a pace of 2.2 percent.
But the government has not announced officially when the recession will end.