u.s. ism factory index falls to 51.4 in may from 5

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U.S. ISM Factory Index Falls to 51.4 in May From 53.3 in April

June 1 (Bloomberg) -- The pace of U.S. manufacturing growth slowed in May for a sixth straight month, a private survey showed.

The Institute for Supply Management said today that its factory index fell to 51.4 from 53.3 in April. Readings higher than 50 indicate growth.

Companies trying to hold down costs may have been reluctant to add to inventories that grew during the first quarter, limiting the need for additional production. Consumer spending and business investment to update equipment will probably keep manufacturing from slipping much further, economists said.

``Businesses have been paring back inventories, and that makes for sluggish growth,'' said Michael Gregory, a senior economist at BMO Nesbitt Burns in Toronto, before the report. ``A lot of companies are still somewhat cautious about spending, but investment is still grinding higher and that will be enough to keep the factory sector expanding.''

A reading of 52 was forecast for May, based on the median estimate of 72 economists in a Bloomberg News survey. Projections ranged from 48.5 to 55. The institute, based in Tempe, Arizona, surveys more than 400 companies in 20 industries, including clothing, printing, transportation, furniture and plastics to compile its index