U.S. manufacturing activity expands the most in three years

Factory activity expanded at the fastest pace in three years in August as new orders jumped the most in 10 years, indicating strong momentum for the economy heading into the third quarter.

The Institute for Supply Management’s index (ISM) surprisingly climbed to 59, the highest level since March 2011, compared with 57.1 in July. Analysts had called for a reading of 57.1.

The jump in the head index was boosted by the new orders gauge which soared to 66.7, the highest since April 2004.

-New orders rose to 66.7 from 63.4 last month

-Employment fell to 58.1 from 58.2 last month

-Supplier deliveries fell to 53.9 from 54.1 last month

-Inventories rose to 52.0 from 48.5 last month

-Customer inventories rose to 49.0 from 43.5 last month

-Prices paid fell to 58.0 from 59.5 last month

-Backlog of orders rose to 52.5 from 49.5 last month

-New export orders rose to 55.0 from 53.0 last month

-Imports rose to 56.0 from 52.0 last month