U.S. factories expanded last month at a weaker pace, with orders growing more slowly and hiring essentially flat.
The Institute for Supply Management, a trade group of purchasing managers, says its manufacturing index slipped to 51.5 in March from 52.9 in February.
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It was the fifth straight drop. Still, any reading above 50 signals expansion.
U.S. manufacturers have faced a drag in recent months from falling oil prices and a rising dollar.
Some drilling rigs have stopped as oil prices have fallen more than 50 percent since June to below $50 a barrel, curbing demand for pipelines and machinery from factories. Simultaneously, the dollar has risen in value against the euro and other currencies, making American-made goods more expensive abroad and cutting into exports.