NEW YORK (Reuters) - U.S. manufacturing grew in November at its quickest pace in five months, bolstered by a rise in domestic demand, an industry survey showed on Wednesday.
Financial information firm Markit said its U.S. “flash,” or preliminary, manufacturing Purchasing Managers Index rose to 52.4 from a three-year low of 51.0 in October. A reading above 50 indicates expansion.
Output in the sector and domestic new orders also grew at their fastest pace since June, while the pace of hiring in the factory sector was the swiftest in four months.
Some respondents said efforts to rebuild after Hurricane Sandy ravaged the U.S. East Coast in late October may have accounted for some of the increased demand.
But Markit chief economist Chris Williamson said there were “surprisingly few” who tied the increase in output or employment to the storm, adding that weather-related effects might show up more prominently in next month’s survey.
The decline in new orders from overseas clients, meanwhile, was the slowest since May, “suggesting trade will also act as less of a dampener on the economy during the summer months,” Williamson said.
“This is an encouraging sign that the slowdown in the goods-producing sector may have bottomed out,” he said, which should make manufacturing a positive contributor to overall U.S. growth in the fourth quarter after acting as a slight drag between August and October.
One possible cause for concern: a sharp rise in the survey’s input prices component to 63.6, the highest reading since March. Here, however, the storm probably did play a part by causing short-term shortages of certain goods and breaking supply chains temporarily, Williamson said.
The “flash” reading is based on replies from about 85 percent of the U.S. manufacturers surveyed. Markit’s final reading will be released on the first business day of the following month.
Reporting By Steven C. Johnson; Editing by Chizu Nomiyama