ISM's Ore: 3 months away from manufacturing growth

NEW YORK (Reuters) - The U.S. manufacturing sector will probably take another three months to get it back into growth territory, Norbert Ore, chairman of the Institute for Supply Management's manufacturing business survey committee, said on Wednesday.

The ISM reported earlier the U.S. manufacturing sector shrank in June but at a slower pace than during the prior month.

The ISM's index of national factory activity edged up to 44.8 to in June from 42.8 in May, an improvement but still below the level of 50 that separates contraction from growth.

"At the current rate it's going to take another three months to get there because the index seems to be moving at about 2 to 2.5 points per month," Ore told a teleconference of journalists after the ISM release.

"And I don't see any reason that we ought to improve a lot faster than that."

Ore also said deflationary pressures in the manufacturing sector appeared to be abating, though the rise in oil prices had helped to stop the decline in companies' pricing power.

"Particularly the fact that oil prices have gone up a little bit, that stabilized pricing in a number of areas -- for instance plastics are impacted by that, chemicals are impacted by it -- and kind of stopped the decline in pricing," Ore said.

"It was probably about time for that to happen anyway and oil just makes it firm up a little bit."

(Reporting by Burton Frierson; Editing by Neil Stempleman)