Manufacturing activity fell more than expected in September, amid the weakest improvement in business conditions since June.
The September "flash," or preliminary, manufacturing Purchasing Managers Index came in at 51.4. September PMI had been expected at 51.9, down from 52 in the previous month. (A reading above 50 indicates expansion in the sector.)
"September's survey data points to a sustained upturn in manufacturing production, although growth remains subdued overall and only slightly faster than seen through the first half of 2016," Tim Moore, senior economist at IHS Markit said, said in a statement. "However, manufacturers reported firmer job hiring than one month previously and input price inflation nudged upwards, meaning that the weaker headline PMI figure is unlikely to dampen expectations that the Fed will tighten policy at the end of the year."