Growth in the US manufacturing sector slowed unexpectedly in March, confounding expectations of an acceleration. The ISM index of manufacturing activity fell from 56.7 to 55.2 – well below the consensus forecast of 57.7 but still above the 50 level that separates expansion from contraction.

Economists said the ISM reading was especially disappointing after regional surveys of manufacturing had pointed to faster growth. The reading was still consistent with economic growth of about 3 per cent, they said.