Manufacturing growth slows, prices jump

By @ibtimes on

The U.S. manufacturing sector grew at a marginally slower pace in March although a measure of prices rose to their highest level since July 2008, according to an industry report released on Friday.

The Institute for Supply Management's (ISM) index of national factory activity dipped to 61.2 last month from 61.4 in February, when it was the highest rate of growth since May 2004. The March reading was close to economists' expectations of 61.0.

A figure below 50 indicates contraction in the manufacturing sector, which has led the U.S. economic recovery out of recession. A reading above 50 means expansion.

The prices paid component jumped to 85.0 from 82.0, topping economists' forecast of 83.0.

The employment index eased to 63.0 from February's 64.5, which had been its highest level in decades.

It's a very modest nick in the optimism created by the jobs numbers, said Jim Awad, managing director at Zephyr Management in New York.

Earlier on Friday a U.S. government report showed U.S. employment recorded a second straight month of solid gains in March and the jobless rate fell to a two-year low of 8.8 percent.

The ISM's reading of new orders, a closely watched indicator of future manufacturing, fell to 63.3 from 68.0 the month before. Exports also dropped to 56.0 from 62.5.

U.S. stocks held gains immediately following the data, while U.S. Treasury prices trimmed losses.

(Reporting by Leah Schnurr; Editing by Padraic Cassidy)

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