US manufacturing growth slows in May
- 24 May 2012
- From the section Business
US manufacturing growth slowed in May as exports weakened, according to a report from research firm Markit.
Its purchasing managers index' (PMI) fell to a three-month low of 53.9, down from 56.0 in April. A reading above 50 indicates expansion.
There were also signs of weakness in the latest durable goods orders.
Orders for long-lasting US factory goods edged 0.2% higher in April, but an indicator of business investment plans fell sharply.
Core capital goods orders, which economists use as a gauge for business investment plans, fell 1.9% last month, figures from the US Commerce Department showed.
"Durable goods orders also give a message of business uncertainty and lack of confidence," said Pierre Ellis, senior economist at Decision Economics in New York.
"It looks more and more like businesses are hesitating to invest in the face of worsening uncertainties in the US and global economy," he said.
Markit said that slowing export sales, particularly to Europe, contributed to the weaker showing .
"US manufacturing seems to be repeating the trend seen in the previous two years, whereby a strong start to the year loses momentum as summer approaches," said Markit chief economist Chris Williamson.
"This year, the cause seems to lie largely with weak export sales, which likely reflects the deteriorating economic situation in Europe as well as slower growth in China," he said.
However, the US performance is much stronger than Europe, where PMI data released earlier indicated that activity at European businesses hit a near three-year low in May.