- Markit
Activity in the US manufacturing sector surprised to the downside in August, as factory output growth slowed from the quickest pace in three months. According to Markit, flash reading of manufacturing activity in the world's number one economy dropped to 52.9 this month, marking the lowest level since October 2013. Economists, however, had expected the gauge to remain unchanged at 53.8.
Markit's data showed a strong growth of overall new order volumes received by manufacturers, albeit the rate of expansion moderated slightly since July. Sluggish export sales remained a drag on new business intakes this month. On top of that, weak capital spending in the energy sector continued to weigh on some manufacturers' order volumes. Softer rates of output and new business growth contributed to greater caution regarding staff employment in August, with a slowdown in job creation to the level last seen in July 2014. August data also indicated broadly similar rates of input price and output charge inflation as those registered in July. Higher average cost burdens have now been recorded for four consecutive months, but the rate of inflation remained well below the long-term average in August. Additionally, the latest rise in factory gate charges was only modest, with survey respondents linking this to weak cost pressures, especially in terms of raw material prices.
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