Manufacturing growth lowest in two years

Manufacturers had their weakest growth in two years in July, a sign that the economy could still weaken.

The Institute for Supply Management, a trade group of purchasing executives, said Monday its index of manufacturing activity fell to 50.9 percent in July from 55.3 percent in June. The reading was the lowest since July 2009, one month after the recession officially ended.

Any level above 50 indicates growth. Manufacturing has expanded for 23 straight months.

Still, new orders shrank for the first time since the recession ended. Output, employment, and prices paid my manufacturers all grew more slowly in July.

The report on manufacturing is the first major reading on how the economy performed in July. It suggests the dismal economic growth in the first half of the year could extend into the July-September quarter.