Manufacturing in the Philadelphia region contracted in June at the slowest pace in nine months as measures of orders and sales improved.

The Federal Reserve Bank of Philadelphia’s general economic index climbed to minus 2.2, higher than anticipated, from minus 22.6 in May, the bank said today. Negative numbers signal contraction.

The slump in manufacturing may abate after companies reduced inventories in the first quarter at the fastest pace on record. Still, production cutbacks and plant closures at carmakers General Motors Corp. and Chrysler Group LLC are likely to depress factory production near term. Read more…