Boost to US hopes of an early exit from recession

The US economy contracted in the second quarter more slowly than initially thought, but negative news on jobs and on manufacturing activity in the country&rsquo;s Midwest region in September pointed to a patchy recovery from recession.<br /><br />GDP fell at a 0.7 per cent annual rate instead of the one per cent decline reported last month, the USCommerce Department said yesterday. It was the fourth straight quarter of decline in real GDP, but probably the last quarter of falling output for the US economy, which slipped into recession in December 2007.<br /><br />On the manufacturing front, however, the Institute for Supply Management-Chicago said its business barometer fell to 46.1 in September from 50.0 in August; a reading above 50 indicates expansion.<br /><br />Another survey showed private employers cut 254,000 jobs in September, more than the 210,000 layoffs markets had been expecting.