Buying Agents Say Economy Is Still Slowing

The U.S. manufacturing economy slowed in February for the 10th consecutive month, although the decline was at the lowest rate since last June, according to a survey of the nation’s purchasing managers released Thursday.

The National Assn. of Purchasing Management said the figures showed that although certain manufacturing indicators reflected further strength, the sustained decline pointed to a continued underlying economic weakness.

The trade association said its index rose to 48.3% in February from 45.2% in January.

A reading below 50 indicates that the U.S. manufacturing economy generally is declining; above 50, that it generally is expanding.

The February reading was the highest since June’s 48.8%, the group said from its headquarters in Tempe, Ariz.

The new-orders portion of the group’s survey showed that segment expanding for the first time since May, while the production segment registered overall growth for the first time since last June. In addition, both new-export orders and imports continued to show increased growth, the group said.

The employment portion of the survey declined for the 12th consecutive month, but the rate of decline was the lowest since June.

Supplier deliveries were faster for the 10th consecutive month and at a significantly greater rate than in January, when many shortages of delivered goods resulted from severe cold weather, the group said.

Prices of goods declined for the ninth consecutive month and at the greatest rate of decline since December, 1982.

“Although the first increases registered in production and new orders since mid-1989 are encouraging, the continued improvement in supplier deliveries and significant decline in prices suggests a lack of any underlying strength in the economy,” said Robert J. Bretz, chairman of the trade group’s survey committee and director of materials management at Pitney Bowes Inc.