Markit US Manufacturing PMI Weakens in August

Joy Montgomery
September 2, 2017

To keep pace with rising client demand, companies increased staffing numbers for the fourth straight month in August, at the most marked pace in more than 17 years.

Markit's purchasing managers' index (PMI) for the sector rose to 56.9, up from 55.1 in July, and against expectations of a fall to 55.

New contracts predominately came from the domestic market, although exports remained strong, if down on July's near-record high.

The reading was the highest since April 2011 and marked the eleventh consecutive month over the 50-point threshold dividing an expansion in activity from a contraction. "New export orders didn't disappoint either with new business wins from Europe and the US - which all supported the sector's fastest rise in jobs growth since June 2014".

"(The) survey showed growth moving broadly sideways, maintaining the recent positive trend of improvement in the health of the manufacturing sector", said Paul Smith, senior economist at IHS Markit, which compiles the survey.

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India's factory activity unexpectedly expanded in August, snapping back from a contraction the previous month, as disruptions stemming from confusion over a new national sales tax eased, a business survey showed on Friday.

A stronger manufacturing sector also led to more jobs, with the rate of increase in employment the fastest since June 2014.

Markit said the breadth of expansion made it look more likely that United Kingdom manufacturing would continue to grow over the second half of the year.

Input cost inflation hit a five-month high and was above its long-run average. "Business conditions improved across the three main subsectors - consumer, intermediate and investment goods - and at smaller and large-scale producers alike", says Dobson.

Manufacturers said they expected output to rise in August and fall in September, suggesting factory activity is losing a little momentum after faster gains earlier this year.

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