Investing.com – Activity in the US manufacturing sector registered a larger-than-expected decline in September, amid the slowest expansion of new orders this year, according to preliminary data released on Friday.
In a report, market research group Markit said that its flash manufacturing purchasing managers’ index (PMI) dropped to 51.4 in September from the prior month’s final reading of 52.0.
Analysts had expected the index to decrease to 51.9 this month.
On the index, a reading above 50.0 indicates expansion, below indicates contraction.
Markit did note that there was a moderate upturn in payroll numbers, despite the slower expansion of output volumes.
IHS senior economist Tim Moore said that the data pointed to a sustained upturn in manufacturing production, even though growth remains subdued overall.
“Softer new order gains are the main concern in the latest PMI survey and this could act as a drag on production growth into the final quarter,” Moore warned.
The market research group also said that new business growth eased further from June’s nine-month peak and that export orders fell for the first time since May.
In an immediate reaction, EUR/USD was trading at 1.1216 from around 1.1209 ahead of the release of the data, GBP/USD was at 1.2947 from 1.2944 earlier, while USD/JPY was at 100.90, compared to the prior 100.95.
The US dollar index, which tracks the greenback against a basket of six major rivals, was at 95.47, compared to 95.51 ahead of the report.
Meanwhile, U.S. stocks were trading lower after the open as the Dow 30 lost 43 points, or 0.23%, the S&P 500 declined 7 points, or 0.31% , and the tech-heavy Nasdaq Composite traded down 17 points, or 0.32%.
Elsewhere, in the commodities market, gold futures traded at $1,343.15 a troy ounce, compared to $1,342.45 ahead of the data, while crude oil traded at $46.23 a barrel from $46.22 earlier.
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