Manufacturing growth slows

WASHINGTON -- Growth at the nation's manufacturers slowed in April for the fifth consecutive month, reflecting a cooling economy that may be easing inflation worries.

The Institute for Supply Management said yesterday that its index measuring manufacturing activity registered 53.3 in April, down from March's 55.2.

The manufacturing sector's performance was weaker than the 55.0 analysts had expected and it left the index at its lowest level since July 2003.

Still, the sector expanded for the 23d consecutive month. A reading of 50 or above means the manufacturing sector is growing, while a figure below 50 represents a contraction.

''The report is consistent with some moderation in the economy," said Mark Vitner, a senior economist at Wachovia Corp. in Charlotte, N.C. He believes the Federal Reserve nevertheless needs to continue raising short-term interest rates to ensure inflation does not become a problem.

Fed policy makers meet tomorrow and are expected to raise the federal funds rate by one-quarter of one percentage point, to 3 percent. That would be the eighth such increase since June 2004.

Norbert J. Ore, head of the ISM's survey committee, framed the slowdown in the manufacturing sector's growth as a good thing, saying it ''should relieve some of the pricing pressure that the sector has experienced during 2004 and year to date in 2005."

Also yesterday, the Commerce Department said construction spending rose 0.5 percent to a record level in March, as strong building activity at offices and shopping malls helped offset a slowdown in housing construction.

The increase pushed total construction activity to a seasonally adjusted annual rate of $1.05 trillion, an all-time high, the agency said.

The Dow Jones industrials climbed 59.19 to close at 10,251.70, while the Nasdaq Composite index rose 7.00 to 1,928.65.