The overall economy grew for the 113th straight time, although at a slower pace than in the month before, the Institute for Supply Management reported Monday.
According to the ISM's monthly report on business, the ISM index decreased to 59.8 in September from 61.3 in August.
Economists polled by IFR Markets predicted the index would be 59.5.
An index reading below 50 signals a slowing economy, while a level above 50 suggests expansion. A reading of 50 shows the sector was unchanged in the month.
The measure of new orders fell to 61.8 from 65.1; production index advanced to 63.9, the highest since January, from 63.3 Gauge of prices paid slipped to a 10-month low of 66.9 from 72.1; biggest one-month decline since June 2017 Employment index rose to 58.8, highest since February, from 58.5
The ISM report indicates manufacturing is coming off the boil while still expanding at a solid pace amid steady demand and lower taxes. The industry is poised to contribute to economic growth this quarter even as trade tensions with China escalate.
Declines in gauges of backlogs and supplier-delivery times signal factories are catching up with demand, helping to dissipate price pressures. In prior months, producers’ rush to buy materials ahead of U.S. tariffs and counter-levies by China triggered supply-chain disruptions and a surge in costs.
The ISM index of employment bodes well for manufacturing payrolls, which are projected to rebound in September after a small drop in August. The data will be part of the U.S. jobs report due on Friday from the Labor Department.
Gauge of supplier deliveries fell to a five-month low of 61.1 from a 64.5 reading that was near a 14-year high; shows lead times growing at slower pace as producers find it easier to meet demand Index of backlogs fell to 55.7 from 57.5; inventories slid to 53.3 from 55.4 Export orders measure rebounded to 56, the first pickup in three months, from 55.2
