Bloomberg reported that U.S. Manufacturing probably expanded in December at the fastest pace in six months, economists said before a report to be issued later today.

According to the report, The Institute for Supply Management’s factory index rose to 53.4 last month from 52.7 in November, according to the median projection of 63 economists surveyed by Bloomberg News. Fifty is the dividing line between growth and contraction. Construction spending increased for a fourth straight month in November, another report may show.

The report states that increasing demand for autos, gains in holiday sales and lean inventories may pave the way for further strength in the industry that accounts for about 12% of the economy. At the same time, faltering growth in Europe due to the debt crisis poses a risk to the U.S. expansion.
 
As reported, the end-of-year deadline to qualify for a larger government tax credit most likely contributed to an increase in business demand for equipment.