Manufacturing, Jobs Reports Add Up to More Bad News
U.S manufacturing grew in June at its slowest pace in 11 months and hiring in the sector slowed as overseas demand for U.S. products waned, an industry survey showed on Thursday.
Financial information firm Markit said its U.S. "flash" manufacturing Purchasing Managers Index fell to 52.9 from 54.0 in May. The June reading was the lowest since last July although it stayed above 50, indicating expansion in activity.
For the second straight month, weaker demand from Europe and large emerging markets such as China dented sales. Markit said U.S. manufacturers reported the second largest decline in new export orders since September 2009.
The index's new orders component fell to 54.1 from 54.6.
The employment component fell in June to 53.1, reflecting the weakest rate of hiring in eight months. It stood at 54.3 at the end of May.
"The impact of weak sales on employment is a key concern," said Markit chief economist Chris Williamson. "The close fit of the survey data with non-farm payroll number suggests that the official (employment) data for June will show a further weakening of the labor market."
Job growth in the United States slowed sharply for a third consecutive month in May and the unemployment rate rose for the first time in nearly a year.
In other data on Thursday, the number of Americans filing new claims for unemployment benefits was little changed last week, according to government data on Thursday that suggested the labor market was struggling to regain momentum.
Initial claims for state unemployment benefits slipped 2,000 to a seasonally adjusted 387,000, the Labor Department said. The prior week's figure was revised up to 389,000 from the previously reported 386,000.
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