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Manufacturing Cools in US, China; Accelerates in India, Euro-Zone

Economy downbeat in U.S.
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Global surveys of manufacturers show factory activity has cooled in the United States and China, while growth has accelerated in India and the 16-nation euro-zone.

The U.S. Institute for Supply Management says its manufacturing index fell to 55.5 in July from 56.2 in June. A reading above 50 means factory output is growing, while a sub-50 reading signals contraction.

It is the 12th consecutive month of growth for U.S. manufacturers, but the pace of that growth has declined for the past three months. July's reading beat economists' forecasts of a slowdown to 54.1.

Another survey of manufacturing companies in China found that factory production shrank in July for the first time in 16 months. London-based bank HSBC and financial services company Markit say China's purchasing managers index, or PMI, fell to 49.4 from 50.4 in June.

HSBC and Markit say India's manufacturing sector performed better in July, with faster growth driven by new orders. India's PMI rose to 57.6 from 57.3 in June.

A separate report shows manufacturing growth also accelerated last month in the 16-nation euro-zone, where Germany accounted for most of the increase. The Markit survey said the euro-zone's PMI rose to 56.7 in July from 55.6 in June.

China's government has been trying to cool down industrial production to prevent the economy from overheating. It has tightened companies' access to credit and imposed limits on property speculation and investment in energy-intensive plants.

China's statistics bureau published its own manufacturing index Sunday, showing a slowdown in growth to 51.2 in July from 52.1 in June.

Some information for this report was provided by AP, AFP and Reuters.

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