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Updated: U.S. Flash PMI Falls To 54.7 In April
By Kitco NewsThursday April 23, 2015 9:45 AM
Editor's Note: The article was updated to include more information from the report.
(Kitco News) - Although the U.S. manufacturing sector is losing more momentum than expected, itremains in expansionary territory, according to the latest Purchasing Managers Index data.
Thursday, private research firm Markit said its April flash estimate PMI fell to a level of 54.7, compared to March’s final reading of 55.7. According to consensus reports, economists were expecting to see a reading at 55.6.
"Although still comfortably above the 50.0 no-change value, the latest index reading signalled the least marked improvement in overall business conditions since January," the report said.
A reading above 50.0 signals an improvement in business conditions, while readings below 50.0 signal deterioration.
Looking at the components of the report, new orders fell to 55.4 from the previous reading of 57.2. Output also decreased to 55.4 from 58.8.
At the same time the report said that job creation in the manufacturing sector was “little-changed” from March.
Chris Williamson, chief economist at Markit said that weaker exports as a result of a stronger U.S. dollar appear to be the key factors in the weaker-than-expected growth.
“However, while exporters are suffering, domestic demand looks to have remained robust, helping to sustain a reasonably strong production trend,” he said. “The appreciation of the dollar is meanwhile also helping to keep inflation down, with firms reporting lower import prices helping push average prices paid for raw materials down sharply again. The past two months have seen the steepest back-to-back falls in manufacturers’ input prices since 2009.”
Recent regional manufacturing data has been relatively mixed so far this month. Last week, the Philadelphia Federal Reserve said that the index for its manufacturing business outlook survey rose to 7.5 in April, from March’s reading of 5.0. However, the New York Federal Reserve reported a considerable drop in its regional manufacturing sector as its Empire State manufacturing survey for April fell into negative territory for the first time since December, hitting a reading of -1.2, down from March’s reading of 6.9.
By Neils Christensen of Kitco News; nchristensen@kitco.com
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