US manufacturing PMI rises in January, Markit says

The US manufacturing purchasing managers’ index (PMI) increased in January to a reading of 53.9 from 53.7 in the month before.

Analysts expected the PMI to remain at 53.7.

The increase was driven by output volumes rising at a "robust pace", Markit said.

However, the report noted that the manufacturing sector has cooled from the peaks seen during last summer.

Export demand remained subdued in January due to a strong dollar and the weak oil prices resulted in reduced demand for investment goods from the energy sector, but the increase in manufacturing production was the strongest in the last three months and payroll number have risen for the 19th consecutive month.

“Manufacturing continued to expand in January, but the sector remains in a lower gear compared to that seen last summer," chief economist Chris Williamson said.

"Factory output growth and job creation remain well below last year’s peaks, adding to the suspicion that the pace of economic expansion in the first quarter could even fall below the 2.6% rate seen in the final quarter of last year."