With a few exceptions, manufacturing activity continues to improve from weaknesses during the spring, according to an analysis released this morning by the National Association of Manufacturers. Additional data to be released this week, however, could provide a clearer picture.
"This week will be a big one on the economic front," NAM Chief Economist Chad Moutray said in his Monday Economic Report.
The key headline to watch will come on Wednesday with the release of second-quarter real GDP, with economists revising their estimates lower in the past few weeks to 1 percent or less, he said.
"If the Bureau of Economic Analysis confirms this, it would suggest extremely sluggish growth in the first half of 2013, with first-quarter growth recently revised down to 1.8 percent," Moutray said.
Other key economic data to be updated this week will be an updated Purchasing Managers Index from the Institute for Supply Management and employment numbers for June, which will provide indications of whether the manufacturing sector can reverse its recent declines in hiring, he said.
NAM's measure of purchasing managers' activity, the Markit Flash U.S. Manufacturing Purchasing Managers' Index, increased from 51.9 in June to 53.2 in July, suggesting modest growth overall and increases in new orders, output and employment. This included export sales, which contracted in June and have been slow so far in 2013.
Regionally, manufacturing activity in the Midwest increased 0.4 percent in June, according to a report from the Federal Reserve Bank of Chicago. Output increased in the last month in all manufacturing sectors. Production increased in all four regional sectors covered by the survey, including steel, machinery and automobiles. Click here to read the report.