The Institute for Supply Management (ISM) said its index of national factory activity rose at the fastest pace in 15 months to 53.2 in June from 51.3 in the previous month. The reading was above expectations of 51.4.
A reading above 50 indicates expansion in the sector, while a figure below 50 means contraction.
The institute also said its employment index rose to 50.4 from 49.2 in May. Meanwhile, economists had expected a reading of 49.0.
New orders advanced to 57 from 55.7 in the prior month. The prices paid index declined to 60.5 from 63.5 in May, while analysts had expected it to be unchanged.
