American factory output in October grew at the fastest pace in two and a half years as the 16 day government shutdown seems to have had little effect on the manufacturing sector.
The Institute for Supply Management's index rose to 56.4 the highest since April 2011 from 56.2 in September. Economists in the Bloomberg Survey predicted a reading of 55.0. The index has been above the 50 division between expansion and contraction for five months since May's dip to 49.0.
Automobile sales, which have been a strong point in the economy for the past year, dropped slightly in October to 15.15 million annually, from September's 15.21 million pace. The post-recession high was 16.02 million in August. Analysts had estimated 11.90 million sales.
Sales of domestically produced car rose to 11.73 million annually in October from 11.6 6 million in September, just under the 11.9 million estimate.
The biggest improvement in the components of the manufacturing index came in export orders which climbed to 57.0 from 52.0. New orders rose to 60.6 from 60.5 in September and except for August's score of 63.2, it was the best reading in this crucial leading section in two and a half years.
Most of the other components were little changed with the exception of production which slid to 60.8 in October from 62.6 the month prior and employment which slipped to 53.2 from 55.4. The index of orders waiting to be filled rose to 51.5 from 49.5 in September.
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