(Reuters) - The U.S. manufacturing sector continued to expand in December albeit at a slightly lower rate than expected, with employment growing at its fastest pace in nine months, an industry report showed on Monday.
Financial data firm Markit said its preliminary U.S. Manufacturing Purchasing Managers Index dipped to 54.4 from a 10-month high of 54.7 in November. Economists polled by Reuters expected a reading of 55.0.
A reading above 50 signals expansion in economic activity.
The output subindex fell to 57.3 from 57.4 in November, which was the strongest reading in 20 months.
"Over the fourth quarter as a whole, manufacturing has enjoyed its best performance since the start of the year," said Chris Williamson, Chief Economist at Markit.
"Growth of output looks to have accelerated to an annualized rate of approximately 4 percent," he said.
The employment subindex rose to 53.7 from November's final 52.3, "adding to indications that the manufacturing workforce is growing at a reasonable rate again," Williamson said.
Markit's "flash" reading is based on replies from about 85 percent of the U.S. manufacturers surveyed. A final reading will be released on the first business day of January.
(Reporting by Rodrigo Campos; Editing by Meredith Mazzilli)