US manufacturing activity strong but not construction

There was mixed news on the US economic front.

The Institute for Supply Management said that its main index of industrial activity rose to 58.6 in December from 57.8 in November, indicating that manufacturing activity expanded in December for the 19th consecutive month. New orders increased to 67.4 in December from 61.5 in November, while new export orders expanded to 60 in December from 54.7 the month before. Offsetting these positives, the employment index dropped to 52.7 in December from 57.6 in November. The price index also fell, to 72 in December from 74 in the previous month.

Separately, the US Commerce Department reported that construction spending declined 0.4 percent in November, the first drop in 10 months. However, construction spending in October was revised to show a rise of 0.3 percent, compared with an initially-reported flat reading.

Overall, the US economy is still holding up well. The slowdown in construction, however, may signal the start of the end of the housing boom.