U.S. factory activity rebounded from an eight-month low in February and consumer spending rose more than expected in January, suggesting the economy was regaining some strength after a recent slowdown.
The signs of momentum were also evident in other reports on Monday that showed a brisk increase in automobile sales in February and a surprise gain in construction spending in January, despite unseasonably cold weather.
“The economy is beginning the slow process of digging its way out of the weather-induced slowdown of recent months,” said Millan Mulraine, deputy chief economist at TD Securities in New York. “This upward momentum should be sustained in the coming months”
The Institute for Supply Management said its index of national factory activity rose to 53.2 last month after slumping to 51.3 in January, which was the weakest reading since May.
A reading above 50 indicates expansion in the factory sector, and February’s rise reversed two straight months of slow growth.