Growth in the US manufacturing sector slowed in June, with the ISM manufacturing index down slightly from May’s reading, even though new orders rose to a 6-month high. Meanwhile, factory orders fell .5% in May, driven by a decline in demand for military equipment.
Growth in the service sector also slowed in June, despite an increase in new orders and employment, as business activity decelerated.
On a positive note, contracts to buy previously owned homes hit an eight-month high in May, with the National Association of Realtors Pending Home Sales index rising 6.1% to the highest level since last September. The rise was the largest percent increase since April 2010, and spanned across all regions of the country.
The US trade deficit narrowed 5.6% in May to $44.4 billion, as exports rose to a record high $195.5 billion. Exports of consumer goods hit a record high, along with autos, parts and engines. A smaller trade gap is welcome news, after a larger deficit in the first three months of the year subtracted 1.5% from economic growth – a big factor in the economy’s 2.9% contraction in the first quarter.
Source: Census Bureau
After rising to a 15-month high in May, planned job cuts dropped 41% to 31,434 last month, the lowest level of 2014. For the second quarter, a total of 124,693 job cuts were announced, up 3% from the first quarter.
The jobless rate fell to 6.1% in June, the lowest since September 2008, as the economy added 288,000 jobs. June’s job growth caps five straight months of 200,000+ job gains – the first time since 1999. The long-term unemployed – those who have been out of work for 27 weeks or longer – fell to 32.8% of all jobless, the lowest since June 2009.