Manufacturing sector grows slower than expected in April

pulse

May 1, 2017 2:52 PM

Incoming data imply a continued moderation in manufacturing activity April.

US manufacturing grew slower than forecast in April as employers reported less hiring and a slower pace of incoming orders, according to the Institute for Supply Management.

ISM's purchasing manager's index, based on surveys conducted during the month, slipped to 54.8 from 57.2. Economists had forecast a reading of 56.5, according to Bloomberg.

The biggest decreases were recorded in the indexes that track new orders and employment.

But new orders for exports surged. Its index jumped 0.5 points to 59.5, the highest since November 2013. That's a reflection of strong global economic growth, according to Neil Dutta, the head of US economics at Renaissance Macro.

Markit Economics' PMI also released on Monday held at 52.8, unchanged from the flash reading. Readings above 50 indicate that the sector is still in expansion.

Manufacturers reported the slowest improvement in business conditions since last September amid a drop in new orders.

"Price pressures have meanwhile risen to a two-and-a-half year high, which is likely to feed through to final prices paid for goods consumers in coming months," said Chris Williamson, the chief business economist at IHS Markit.

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