Economy up slightly, but threats remain

WASHINGTON (AP) — The nation’s economy is managing to grow modestly, reports Monday showed, despite high U.S. unemployment and growing alarm about Europe’s debt crisis.

Manufacturing expanded in September more than in August, though the pace of growth remains weak, according to a survey by the Institute for Supply Management. The ISM said its manufacturing index rose for the first time in three months.

And construction spending rose modestly in August, the government said. The gain was due mostly to a pickup in state and local government projects.

In addition, U.S. auto sales rose in September, largely because consumers bought more pickups and SUVs, U.S. automakers said.

Collectively, the reports suggested that the U.S. economy may be able to avoid another recession but will continue to struggle.

Economists said the manufacturing and construction reports are consistent with an annual growth rate of about 2 percent to 2.5 percent for the July-September quarter.

That would be an improvement from growth of about 0.9 percent in the first six months of the year.

But it wouldn’t be enough to reduce the unemployment 9.1 percent rate.

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