NEW YORK – Manufacturing grew in October at its slowest pace in more than three years and appeared likely to act as a drag on overall growth in the final months of 2012, an industry survey showed on Thursday.
Financial information firm Markit said its U.S. Manufacturing Purchasing Managers Index fell to 51.0 this month, below a preliminary estimate of 51.3 and September's reading of 51.1. October's reading was the lowest since September of 2009. A reading above 50 indicates expansion.
Output increased at the second slowest rate in three years, while new export orders declined for a fifth straight month as economic difficulties in Europe and Asia sapped demand for U.S. goods.
The survey "suggested that U.S. manufacturing began the final quarter on a weak footing and will remain a drag on the wider economy," said Trevor Balchin, senior economist at Markit.
He said export markets were a "key source of weakness," adding that firms were "again reporting competitive price pressure from Asian markets."
Slower growth in China and elsewhere in Asia have hurt the U.S. manufacturing sector, as had recession throughout much of the 17-country euro zone.
The U.S. economy perked up slightly in the third quarter, growing at a 2 percent rate after expanding by just 1.3 percent between April and June. It is expected to grow around 2 percent for the year. (Reporting By Steven C. Johnson; Editing by Chizu Nomiyama)