US manufacturing PMI advanced at a steady rate April, as new orders and production levels remained elevated in the latest sign the US economy was moving past its recent soft patch.
The Institute for Supply Management’s US manufacturing PMI was unchanged at 51.5 in April. A median estimate of economists called for an increase to 52.0. The US manufacturing industry has been above the 50 mark that separates expansion from contraction for 28 consecutive months.
A reading above 50 is a general sign of growth in manufacturing activity, whereas a reading below that level signifies contraction.
Fifteen of 18 manufacturing industries reported growth in April, as new orders and production grew at a faster rate. New export orders were back in expansion mode after three consecutive months of decline. However, steady factory production was unable to lift employment, which fell to its lowest level since September 2009.
“Low energy costs continue to help the bottom line,” said one manager from the food, beverage and tobacco products industry.
“Business holding relatively flat in North America, softening a bit globally,” added another from transportation equipment.
Added a respondent from the chemical products industry, “Foreign Exchange is reducing revenue, but volume has remained consistent.”
A separate report on US manufacturing PMI showed declines in factory activity. Markit Group’s flash US manufacturing PMI fell to 54.1 in April from 55.7 in March, as businesses reported a slowdown in production voles and a drop in exports.
A weak manufacturing sector weighed on the US economy in the first quarter. US GDP expanded just 0.2 percent annually in the first three months of the year, well below estimates. The economy is expected to pick up the pace in the second quarter. Early estimates show US GDP is on pace to grow around 3 percent annually in the second quarter.