Texas factory sector expands for the first time since 2014

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The Texas factory sector in November expanded for the first time since 2014, in the latest sign of US economic activity picking up steam.

The Dallas Federal Reserve’s gauge of factory activity jumped from -1.5 in October to 10.2 in November, handily beating forecasts of 2.0. A reading above 0 indicates expansion.

The index has been in negative territory since January 2015, as low oil prices hit hard on industries that rely on the energy sector. But the November survey showed improvement across the board, including the employment index, which came in at 4.5 compared to a flat 0.2 in October. The hours worked index returned to positive territory.

The survey is the latest in a string of positive US data in recent weeks, which have helped boost expectations for the Federal Reserve to raise interest rates at its December meeting. Third-quarter GDP in the US expanded 2.9 per cent from the previous year, while the consumer-price index rose by 1.6 per cent in October, the highest level in two years.

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