ISM Manufacturing Index Declines Again in December

key index of U.S. manufacturing growth fell in December for a second straight month, to the lowest level since June, the Institute for Supply Management reported Tuesday.

ISM’s December factory index fell to 54.2 from 58.1 in November, the group said in its monthly report. September and October had been the two fastest-growing months of 2005.

eadings higher than 50 indicate growth, and manufacturing has shown expansion since May 2003.

ISM’s prices-paid index fell to 63 from 74, ISM said.

The survey’s new orders index, which makes up about a third of the total index, fell to 55.5 from 59.8 in November. The production index, a measure of work being performed, fell to 57 from 60.6.

“In December, we saw a decline in the rate of growth of both new orders and production, but both indexes are at levels that support economic growth,” said Norbert Ore, chairman of ISM’s manufacturing committee.

“A strong fourth quarter should carry significant momentum forward into 2006,” he said in a statement.

SM’s employment index fell to 52.7 from 56.6. The inventories index dropped to 47.2 from 49.3, while new export orders declined to 54.3 from 59.2.

ISM, headquartered in Tempe, Ariz., surveys more than 400 companies in 20 industries, including transportation, to compile its index.