The main positive development was a slight rebound in manufacturing job creation from the seven-month low seen during March.
Manufacturers were more cautious in terms of their pre-production inventories in April. The decline in stocks of inputs ended a six-month period of sustained inventory building.
April data signalled a sharp and accelerated rise in average cost burdens across the manufacturing sector. The rate of input cost inflation was the fastest since December 2013, which survey respondents linked to rising commodity prices (particularly metals). Meanwhile, pressure on margins from higher input costs contributed to the strongest increase in factory gate charges for almost two-and-a-half years.
Commenting on the flash PMI data, Chris Williamson, Chief Business Economist at IHS Markit said:
“The PMI data suggest the US economy lost further momentum at the start of the second quarter. The surveys are signalling a GDP growth rate of 1.1% after 1.7% in the first quarter. “The vast services economy saw the weakest monthly expansion for seven months and the manufacturing sector showed signs of growth slowing further from the two-year high seen at the start of the year, despite export orders lifting higher. “The labour market also continued to soften. The surveys signalled a marked step-down in the pace of hiring in March which has continued into April. The latest survey data are consistent with only around 100,000 non-farm payroll growth. “The survey responses indicate that some froth has come off the economy since the post-election bounce seen at the end of last year. However, with inflows of new business picking up slightly in April and business optimism about the year ahead also brightening, there’s good reason to believe that growth could revive again in coming months.”