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US manufacturing grew at its slowest pace this year in April, according to data released on Monday, in the latest sign that the sharp slowdown seen in consumer spending could have a knock-on effect on the wider economy.
The Institute for Supply Management said the reading for its manufacturing index came in at 54.8 last month. That’s below the 57.2 recorded in March and much weaker than the 56.5 the market had forecast.
Still, any number above 50 signals expansion and the April figure marks the 8th straight month that the gauge has come in above 50 following a lacklustre start to 2016.
Of the 18 manufacturing industries, 16 reported growth in April. The only industry that reported contraction in April compared to March is Apparel, Leather & Allied Products.
Another sign that growth in US manufacturing could be losing steam can be seen in new orders. The reading for the gauge was 57.5, compared to 64.5 in March.
Meanwhile, the IHS Markit US manufacturing purchasing managers’ index, also released on Monday, was 56.5 in April, unchanged from the reading reported in March.
Both data sets come amid growing concerns over the weakening pace of recovery in the US economy. Data published last week showed that US gross domestic product grew at just a 0.7 per cent annual rate in the first three months of the year – the slowest pace in three years – amid a slowdown in consumer spending.