NEW YORK (Reuters) - The manufacturing sector grew in May at its slowest pace in three months as economic trouble overseas dented demand for exports, an industry survey showed on Friday.
The final Markit Manufacturing Purchasing Managers Index stood at 54.0 in May, above last week’s preliminary estimate of 53.9 but below April’s reading of 56.0.
Markit chief economist Chris Williamson attributed the slowdown to “a near-stagnation of export orders, reflecting deteriorating demand in many overseas markets, notably the euro zone but also emerging markets such as China.”
Overall, though, manufacturing grew for a 32nd straight month, and the slowdown in exports reduced raw material prices, which Williamson said is good news for the inflation outlook and “should help take some pressure off squeezed profit margins.”
Markit, which conducts surveys for 32 countries, began publishing a U.S. index this month but has been collecting data on factory activity since late 2009.
The Institute for Supply Management, which will publish its own manufacturing survey on Friday, has shown expansion in the sector for 33 months running. A Reuters survey showed economists expect ISM to come in at 53.9 in May compared to 54.8 in April.
Reporting By Steven C. Johnson; Editing by Chizu Nomiyama