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Federal Reserve

US factory activity drops in Nov.; first decline in 3 years

U.S. factory activity plummeted last month to the lowest level in more than six years, with a stronger dollar and low oil prices cutting new orders and hurting production.

The Institute for Supply Management said Tuesday that its index of factory activity in November dropped to 48.6 from 50.1 in October. Any reading below 50 signals contraction and the index has tumbled below that critical level for the first time since November 2012.

It now rests at its lowest level since June 2009, a worrisome sign as Federal Reserve officials will consider raising short-term interest rates this month on the understanding that the economy has sufficiently healed from the Great...