The Institute for Supply Management released a report on Wednesday showing a modest contraction by U.S. manufacturing activity in the month of April.
The ISM said its manufacturing PMI slipped to 49.2 in April from 50.3 in March, with a reading below 50 indicating contraction. Economists had expected the index to edge down to 50.0.
The slight pullback by the index came after it indicated a modest expansion in March following sixteen consecutive months of contraction.
“Although demand improvement slowed, output remains positive and inputs stayed accommodative,” said Timothy R. Fiore, Chair of the ISM Manufacturing Business Survey Committee.
The modest decrease by the headline index partly reflected a downturn by new orders, as the new orders index fell to 49.1 in April from 51.4 in March.
The production index also slid to 51.3 in April from 54.6 in March, indicating a slowdown in the pace of growth.
Meanwhile, the employment index rose to 48.6 in April from 47.4 in March, although a reading below still indicates a decrease in manufacturing jobs.
The report also said the prices index jumped to 60.9 in April from 55.8 in March, suggesting a notable acceleration in the pace of price growth.
On Friday, the ISM is scheduled to release a separate report on activity in the U.S. service sector in the month of April.
The services PMI is currently expected to inch up to 52.0 in April from 51.4 in March, with a reading above 50 indicating growth.
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