US manufacturing growth remains tepid, consumer confidence improves

Manufacturing activity in the US continued to grow at a tepid pace in April as a recovery in new orders was offset by employment falling to its lowest level in more than five years. According to the Institute for Supply Management, the index of factory activity came in at 51.5 in April, remaining unchanged from the previous month, which had marked the lowest level since May 2013. Economists, however, had expected a 52.0 reading. The employment index slid into red territory for the first time since May 2013, declining to 48.3, the lowest level since September 2009. In March, the employment sub-index was 50.0. The weak factory payrolls data may temper expectations for Friday's April payrolls report from the Labor Department. Economists estimated total nonfarm payrolls rose 220,000 in April, after an unexpectedly weak increase of just 126,000 new jobs in March. Manufacturing payrolls lost 1,000 jobs in March. A separate report showed, consumer confidence rose in April to the second-highest reading in more than eight years as Americans became more optimistic about their financial prospects. The University of Michigan said that its final index for the month jumped to 95.9 from 93 in March. Americans' inflationary expectations declined to 2.6% in the next year, down from 3% in the previous month. Over the next five to 10 years, they also expect a 2.6% rate of inflation, compared with 2.8% in the previous month.