Markit: US Manufacturing Growth Still Sluggish; Platinum Near 7-Year Low

Markit’s flash purchasing managers’ index (PMI) scored 53.9 for this month, down slightly from August but still above the 50 score that implies no growth and in line with economic growth.

Worryingly, the flash index for new export orders in the world’s third-biggest economy slipped to 47.8, from a final 51.6 in the previous month to show the biggest contraction since February 2013. Factory gate prices fell, however, dropping for the first time in six months as manufacturers passed lower raw material costs on to customers. Stocks and commodities both fell.

“September PMI data pointed to a general slowdown in the expansion of the Japanese manufacturing sector“, said Markit’s economist Amy Brownbill.

“The ECB would no doubt like to see more bang for their euros as far as stimulus from their QE programme is concerned, but it’s debatable whether these numbers are weak enough to convince the central bank to take more aggressive action just yet”. But Markit Chief EconomistChris Williamson cautioned against reading too much into the September uptick.

Growth was broad-based across the manufacturing and service sectors, with the pace of expansion marginally sharper in the former. Anything above 50 indicates expansion.

Williamson believes this sluggish growth, weaker forward-looking indicators and downturn in price pressures all point to the U.S. Federal Reserve holding off with rate hikes until next year. Backlogs of work rose to the highest level since 2011, signaling firms may seek to boost capacity to meet growing demand.

USD/JPY changed hands at 120.35, up 0.07%, while AUD/USD traded at 0.7008, up 0.09%.

The euro zone’s dominant service industry PMI dipped to 54 from 54.4 last month.