U.S. Manufacturing Activity Expanded at Record-High Pace in April -- IHS Markit

By Xavier Fontdegloria

U.S. manufacturing activity grew at a record-high speed in April supported by quicker expansions in output and new orders amid a marked uptick in client demand, data from a survey compiled by IHS Markit showed Monday.

The final reading for the U.S. Manufacturing Business Activity PMI Index April stood at 60.5, marginally down from the preliminary print of 60.6 but above the 59.1 registered the previous month. The data signal the strongest monthly improvement in the sector's operating conditions since data collection began in May 2007.

The reading matches expectations from economists polled by The Wall Street Journal.

April's PMI shows that the pace of growth for factory activity increased compared with that of March, signaling continued strength of the U.S. manufacturing sector. The indicator has been above the 50-point level that separates expansion from contraction since July 2020.

"U.S. manufacturers reported the biggest boom in at least 14 years during April," said Chris Williamson, chief business economist at IHS Markit. Demand surged at a pace not seen for 11 years amid growing recovery hopes and fresh stimulus measures, he said.

Contributing to the greater headline figure in April was a sharp and faster upturn in production across the manufacturing sector linked to a stronger rise in new orders, the report said.

However, companies continued to highlight pressure on capacity following raw material shortages and other supply-chain disruptions.

April data signaled another marked monthly deterioration in vendor performance across the goods-producing sector, with lead times lengthening to the greatest extent on record. "Supply-chain delays worsened, running at the highest yet recorded by the survey, choking production at many companies," Mr. Williamson said.

Input costs rose rapidly in April, with the rate of inflation quickening to the sharpest since July 2008. The increase was attributed to material shortages and greater transportation costs, the report said.

Concerns regarding supply-chain disruptions weighed on expectations and business confidence moderated in April, with optimism slipping to a three-month low, the report said.

Write to Xavier Fontdegloria at [e-mail]

(END) Dow Jones Newswires

05-03-21 1022ET