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U.S. manufacturing sector performance rebounds strongly in February

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U.S. manufacturing sector performance rebounds strongly in February

Manufacturing PMI hits highest level for almost four years.

According to financial data firm Markit, February data suggested a solid rebound in U.S. manufacturing business conditions following the slowdown recorded during the previous month. This was highlighted by a rise in the Markit Flash U.S. Manufacturing Purchasing Managers’ Index (PMI), which is based on approximately 85% of usual monthly replies, from 53.7 in January to 56.7 in February.

The latest reading pointed to the fastest overall improvement in U.S. manufacturing business conditions since May 2010.

"The upturn in the headline U.S. Manufacturing PMI was driven by sharp and accelerated increases in both production levels and incoming new work during February."

The upturn in the headline U.S. Manufacturing PMI was driven by sharp and accelerated increases in both production levels and incoming new work during February. Latest data indicated that output growth recovered strongly from January’s three-month low, suggesting manufacturers have started to shake off the disruptions caused by heavy snowfall and extreme weather conditions in parts of the U.S.

In addition, new business volumes increased at the sharpest rate since May 2010, suggesting resilient underlying demand across the U.S. manufacturing sector. Higher levels of new work in February partly reflected a return to export sales growth following a slight reduction during the previous month.

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Manufacturers indicated that positive job hiring trends continued in February, thereby extending the current period of employment growth across the sector to eight months. Latest data signalled a solid pace of job creation that was the joint-sharpest since March 2013. Survey respondents suggested that greater production requirements, confidence in the economic outlook and, in some cases, pressures on operating capacity had led to rising workforce numbers in February.

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