August 1, 2014 / 1:57 PM / 3 years ago

U.S. factory activity expands in July, pace slows: Markit

(Reuters) - The U.S. manufacturing sector expanded in July, but the pace of growth slipped from the previous month as growth in output, new orders and employment slowed, an industry report showed on Friday.

Ford Assembly workers install a battery onto the chassis of a Ford Focus Electric vehicle at the Michigan Assembly Plant in Wayne, Michigan November 7, 2012. REUTERS/Rebecca Cook

Financial data firm Markit said its final U.S. Manufacturing Purchasing Managers Index slipped to 55.8 in July, down from the 57.3 June reading that was the highest since May 2010. The preliminary read for the index was 56.3.

A reading above 50 signals expansion in economic activity. The last reading below 50 came in September 2009.

The output subindex slipped to 59.7 from 61.0 while a read on new orders dipped to 59.5 from June’s final read of 61.2.

“Although the pace of growth of manufacturing output slowed in July, it remained close to June’s four year high,” said Chris Williamson, chief economist at Markit.

“The goods-producing sector is therefore on course to provide a significant boost to (gross domestic product) in the third quarter, building on the 4 percent annualized growth surge seen in the second quarter.”

The employment component came in at its lowest since June 2013.

Reporting by Rodrigo Campos; Editing by Meredith Mazzilli

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