Economic activity in the manufacturing sector expanded in May for the 34th consecutive month, according to the latest Manufacturing ISM Report On Business.

The Purchasing Mangers Index (PMI) registered 53.5%, a modest decrease of 1.3 percentage points from April’s reading of 54.8%, indicating expansion in the manufacturing sector for the 34th consecutive month, said Bradley J. Holcomb, chair of the ISM Manufacturing Business Survey Committee.

A reading above 50% indicates that the manufacturing economy is generally expanding; below 50% indicates that it is generally contracting.

The New Orders Index continued its growth trend for the 37th consecutive month, registering 60.1% in May. This represents an increase of 1.9 percentage points from April and also the highest level recorded by the index since April 2011.

The Prices Index for raw materials fell to 47.5% in May, dropping 13.5 percentage points from April, indicating lower prices for the first time since December 2011.

Comments from the panel generally reflect stable-to-strong orders, with sales showing steady improvement over the first five months of 2012.”

Of the 18 manufacturing industries, 13 are reporting growth in May, in the following order: Nonmetallic Mineral Products; Furniture & Related Products; Apparel, Leather & Allied Products; Miscellaneous Manufacturing; Primary Metals; Electrical Equipment, Appliances & Components; Fabricated Metal Products; Machinery; Textile Mills; Paper Products; Computer & Electronic Products; Printing & Related Support Activities; and Chemical Products.

The four industries reporting contraction in May are: Plastics & Rubber Products; Petroleum & Coal Products; Food, Beverage & Tobacco Products; and Transportation Equipment.

To read the full report click here.