Outlook for Economy Good, Purchasers Say

NEW YORK —  The U.S. economy continued to improve in November, inflation stayed low and an increase in new orders set the stage for stronger production through the end of 1985, a business group said Sunday.

The National Assn. of Purchasing Management said its composite index advanced to 53.3% in November from 51.7% in October, putting the index at its highest level since the 55.2% recorded in July, 1984.

A reading above 50% generally indicates the economy is expanding, according to the group, whose members are responsible for the purchases made by the nation’s major businesses. The index turned positive in September after seven months below 50%.

Eighty-four percent of the purchasing managers surveyed said that new orders were higher or the same in November, the best reading since February, when the figure was also 84%.

“The impressive growth in new orders virtually assures a good fourth quarter,” Robert Bretz, director of purchasing for Pitney Bowes Inc. and chairman of the association’s business survey committee, said in a news release.

Inflation remained low. Just 2% of the purchasing managers reported paying higher prices in November, the lowest percentage since October, 1971, when it was also 2%. In contrast, 13% of the purchasing managers said they paid lower prices in November.

The association’s monthly report, considered an important indicator of the economy’s health, is based on a survey of the purchasing agents at 250 industrial companies who belong to its business survey committee.