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U.S. Manufacturing Sector Sees Robust Growth in December amid COVID-19 Spikes

The U.S. manufacturing sector saw robust growth in December amid surging COVID-19 cases, the Institute for Supply Management (ISM) reported Tuesday.

The Purchasing Managers' Index (PMI) stood at 60.7 percent, up 3.2 percentage points from the November reading. It marked the highest level since August 2018.

Any reading above 50 percent indicates the manufacturing sector is generally expanding.

The December PMI indicates expansion in the overall economy for the eighth month in a row after contracting in March, April and May, according to the ISM report.

"Survey Committee members reported that their companies and suppliers continue to operate in reconfigured factories, but absenteeism, short-term shutdowns to sanitize facilities and difficulties in returning and hiring workers are causing strains that are limiting manufacturing growth potential," said Timothy Fiore, chair of the ISM's manufacturing business survey committee.

Fiore noted that panel sentiment remains optimistic (three positive comments for every cautious comment), an improvement compared to November.

Sarah House and Tim Quinlan, senior economists at Wells Fargo Securities, wrote in an analysis that they expect manufacturing activity to remain a "bright spot" in the near-term outlook.

Despite the latest round of "impact payments" going out and unemployed workers getting a 300-dollar weekly top off on benefits, services activity is "likely to remain subdued" over the next couple months as "record hospitalizations reinforce the need for social distancing and frees up cash for spending on goods," House and Quinlan said.

(www.chinaview.cn 2021-01-07)