Manufacturing activity in the US expanded during January 2011, growing at its fastest rate since May 2004.

This is according to new data from the Institute for Supply Management, which shows employment in the sector rose over the month above the 60 per cent mark for the first time in almost 11 years.

Between December 2010 and January 2011, the organization's index climbed from 58.5 to 60.8, with any number above 50 indicative of expansion.

It marks the 18th consecutive month of economic growth in manufacturing, with new orders, employment and production all up on December's figures and 14 out of 18 sectors registering climbs.

Norbert Ore, author of the study, remarked: "Global demand is driving commodity prices higher, particularly for energy, metals and chemicals."

In December 2010, overall US joblessness dropped from 9.8 per cent to 9.4 per cent, with a climb recorded by the Bureau of Labor Statistics in non-farm payroll employment of 103,000 over the month from November.

Posted by Fiona Summers