WASHINGTON – Factory activity in the U. S. Midwest slowed only slightly in August and the private companies continue to hire despite the extreme volatility of financial markets, reduced economic worries will fall back into recession. Other data showed on Wednesday a strong rebound in demand for manufactured goods in July as orders for motor vehicles posted their largest gain since 2003, another recession can be avoided despite some suggestions weak economic signals. "For those of us who do not believe the economy is in free fall, we have support," said David Resler, chief economist at Nomura Securities International in New York.
Institute for Supply Management-Chicago business barometer fell to say 56. 5, the lowest since November 2009, from 58. 8 in July. However, reading the above economists 'expectations' and showed activity continues to grow. A separate report from ADP showed private payrolls processor add 91,000 new jobs this month after developing a salary with14 000 in July.
ADP figures come ahead of U. S. government report that the labor market is much more comprehensive on Friday, which is expected to show a slight increase in employment, despite the dampening effect of a strike at Verizon Communications. While the ADP report has a poor track record of predicting non-farm work, it offers business expectations have not been back sharply on hiring despite the huge stock market sell-off and lost both business and consumer confidence. Other data show the number of planned layoffs at U.
S. companies fell in August after rising for three consecutive months, although the wound was far above levels last year. "The labor market is soft but not messy," said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania. "The economy on the brink of recession. " Slower than expected growth has fueled speculation the Federal Reserve could start another round of bond purchases to try to encourage long-term borrowing costs lower.
That outlook helped lift U. S. stock prices on Wednesday, but bond prices slumped. The dollar was little changed against a broad basket of currencies. High unemployment is a major concern for the U.
S. central bank. Non-farm payrolls rose only 75,000 are expected in August, according to a Reuters survey, slowed from the month of July rose 117 000. The unemployment rate held at 9. 1 percent seen.
Modest slowdown in the Midwest factory activity suggest a national manufacturing may not be cooling as fast as has been demonstrated by other regional surveys. It is also implied that the forecasts of the national Institute for Supply Management's manufacturing index fell to 48. 5 in August from 50. 9 in July may be exaggerated. The survey will be published on Thursday.
A reading below 50 indicates contraction, but economists said the reading of 48. 5 would still be inconsistent with the overall recession. "The ISM does not take into account that the auto industry is getting a very strong pick-up in Ord. .