Markit’s initial reading of U.S. manufacturing data for July came in at 56.3.
Expectations were for a reading of 57.5, up from a prior reading of 57.3.
Job creation was the weakest since September 2013.
“Cost burdens” were up on higher raw materials prices, especially metals.
But Markit economist Chris Williamson says recent data remain strong:
US manufacturers are enjoying a summer of scorching growth. Output grew in July at a rate only just below the four-year peak seen in June as inflows of new orders surged higher again. The data suggest the sector is growing at an annualised rate of roughly 8% as we moved into the second half of the year. The growth rebound that the survey has signalled for the second quarter therefore looks to have been sustained into the third quarter. Factories were able to raise their prices to the greatest extent seen so far this year as a result of the improvement in demand, suggesting there may some inflationary pressures building in the manufacturing supply chain.
But some items give him pause:
Worryingly, job creation slid to its lowest since last September, which in part reflects concerns that current sales growth may not be sustained. A key source of concern is export sales, which continue to show disappointingly meagre gains.
Here’s are the charts: