Manufacturing shrinks to lowest level since 2001:

A measure of U.S. manufacturing activity contracted more than expected last month, hitting the lowest level since the aftermath of the Sept. 11 attacks, as new orders slowed dramatically.

The Institute for Supply Management on Wednesday released a September reading of 43.5, the lowest level since October 2001. The reading dropped from 49.9 in August, the largest one-month decline since January, 1984, when it fell to 60.5 from 69.9.

A reading above 50 signals growth.

Financial Times notes:

Nigel Gault, chief US economist at Global Insight in Massachusetts, said the overall decline in the ISM index may have been exacerbated by two strong hurricanes and a strike at Boeing. But he added that it was “consistent with other indicators suggesting that the real economy deteriorated dramatically during the third quarter

Slightly better news is exports grew.