August 1, 2008 10:00 AM, EDT

ISM Factory Index Stagnant in July

U.S. manufacturing was stagnant in July, as factory orders plunged to the lowest level in almost seven years, the Institute for Supply Management said Friday.

ISM’s monthly factory services index declined to 50 from a June reading of 50.2 that was higher than initially reported, the group said. The index had hit a record low of 44.6 in January.

Figures of more than 50 indicate expansion; below that shows contraction. Economists had forecast a decline to 49, Bloomberg reported.

Meanwhile, a gauge of new orders for factories decreased to 45 in July, the lowest level since October 2001, from 49.6 in June.

The factory index measures manufacturing components of the economy.