U.S. manufacturing growth slows in May

U.S. manufacturing slowed for a second straight month in May as weak overseas demand and government belt-tightening at home led to the sector’s most sluggish rate of growth since October, new economic data shows.

Financial data firm Markit said its “flash,” or preliminary, U.S. Manufacturing Purchasing Managers Index fell to a seven-month low of 51.9 in May from 52.1 the previous month.

A reading above 50 indicates expansion. The “flash” estimate is subject to revision, Markit said.

It was the second consecutive month in which the pace of growth slowed, the research firm said. Markit, however, noted that the critical new orders index for manufacturers rose in the month.

The employment index dropped from 53.2 to 52.2.

“With the PMI hitting a seven-month low, the U.S. manufacturing economy continues to show signs of weakening. Growth has slowed sharply in recent months, down from an annualized pace of 4.9 per cent in the first quarter to just 1 per cent in May,” Markit Chief Economist Chris Williamson said in a statement. “The goods-producing sector is therefore likely to have provided only a modest boost to the U.S. economy in the second quarter, providing further worrying signs that growth remains lacklustre.”