Thursday, April 3, 2003

Factory activity declines



The Associated Press

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WASHINGTON - Manufacturing is faltering as the weight of uncertainties surrounding the war in Iraq cause businesses and consumers to turn more cautious.

Orders to U.S. factories fell 1.5 percent in February, the worst showing in five months, the Commerce Department reported Wednesday. Private economists said manufacturers could have seen orders fall even more in March given the muddled economic climate.

In February, orders dropped for metals, machinery, computers and electrical equipment.

A report released Tuesday offered an unsettling picture of the manufacturing sector for March: The Institute for Supply Management's manufacturing index fell to 46.2 from February's 50.5. A reading below 50 means manufacturing activity contracted.

Manufacturing has been the weakest link in the national economy's ability to get back to full throttle. Some private economists worry that the weakness could spread to other parts of the economy, throwing it into a new recession. Chances of a so-called double-dip recession are growing, economists say, because the job market is expected to lose more ground.




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