Global manufacturing growth cooled in August, new orders expanded at their weakest pace in a year and inflationary pressures eased, a report said on Friday.

The global PMI, an indicator produced by JP Morgan with research and supply management organizations around the world, eased to 55.1 in August from 55.5 in July, but still well above the 50.0 mark that separates growth from contraction.

The figure was in line with the 2006 average but the new orders index fell to 55.4 from 56.8, the lowest in a year, suggesting further cooling in coming months.

The PMI indicates that growth of global manufacturing output and employment remained solid, said David Hensley, director of global economics coordination at JP Morgan.

There are however signs of moderation in the report. The pace of new order growth has slowed significantly, while inventory build is relatively rapid. This combination has been a sure signal of weaker manufacturing activity in the past

He expected world manufacturing output growth to slow to a 3 to 4 percent annual rate in coming months.

Manufacturers' cost rises eased significantly, with the input price index down to 69.8 from 73.1 in July.

Separate reports told a similar story earlier on Friday. In the euro zone the pace of manufacturing eased in August, with the RBS/NTC Eurozone Purchasing Managers' index slipping to 56.5 from 57.4 in July.

The U.S. equivalent index of factory activity published by the Institute for Supply Management also fell in August to 54.5 from 54.7 in July. Economists had expected a rise to 55.0.

The global index combines survey data from countries including the United States, Japan, Germany, France, Britain, China and Russia.

Inflation Manufacturing