Index signals key sector is expanding at fastest pace in 15 months

March 06, 2002|By BLOOMBERG NEWS

WASHINGTON -- The biggest part of the U.S. economy expanded in February at the fastest pace in 15 months, the Institute for Supply Management's index of service companies, builders and other nonmanufacturing companies showed yesterday.

The better-than-expected expansion adds to reports of factory growth, rising construction and increases in incomes and spending that show the economy is rebounding from the recession that began a year ago.

The institute's index of non-manufacturing business, which accounts for about four-fifths of the U.S. economy, rose to 58.7, from 49.6 in January. A reading above 50 signals expansion, and the index hasn't been this high since November 2000.

Analysts had expected it to rise to 51, according to the median of 36 forecasts in a Bloomberg survey.

Orders at service companies were the highest in 15 months, reflecting rising sales at retailers such as Costco Wholesale Corp. Demand for goods at the retail level already has started to boost manufacturing production.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.