WASHINGTON • American factories powered up last month at the fastest pace in nearly three years, with robust advances in production, orders and employment that indicate a firming in the economy, data from the Institute for Supply Management (ISM) showed yesterday.

The factory index rose to 57.8, the highest since August 2014, from 54.9 in May, the ISM survey found. Readings above 50 indicate growth.

The 2.9-point monthly gain in the ISM index is also notable as it comes amid fading expectations that the government will deliver a fiscal boost, via tax reform and infrastructure spending, in the near future.

The manufacturing sector, which accounts for about 12 per cent of the United States economy, saw robust growth with 15 of the 18 industries reporting growth.

ISM's gauge of new orders increased to a three-month high of 63.5 from 59.5, its measure of export orders rose to 59.5 from 57.5, and the employment gauge increased to 57.2 from 53.5. The production index rose from 57.1 to 62.4, the highest since February.

Faster growth in orders and production in the final month of the quarter indicates solid demand that, together with rising exports, shows manufacturing is on solid footing.

The ISM's pulse of employment in the sector also indicates the government's measure of factory payrolls, released as part of the Labour Department's jobs report last Friday, will rebound in June after declining a month earlier.

BLOOMBERG