US manufacturing expanded in April – though the rate of growth was slightly lower than expected – as inventories fell, but factory output growth hit its fastest pace in three years, an industry report said Wednesday.
Financial data firm Markit said that its preliminary or “flash” U.S. Manufacturing Purchasing Managers Index dipped to 55.4 in April from 55.5 in March. Economists had expected a reading of 56.0, according to Reuters.
A reading higher than 50 signals expansion in economic activity.
The output subindex jumped to 58.2, the highest since March 2011, from 57.5 last month.
“With manufacturing acting as a good bellwether of the rest of the economy, the survey bodes well for further robust economic growth in the second quarter,” said Chris Williamson, chief economist at Markit, according to Reuters. “This is a domestic-led upturn. Faster growth of new orders is being driven by surging demand from U.S. markets.”
The new orders subindex rose to 58.9 from 58.1 last month.