Investing.com - Manufacturing activity in the Chicago-area rose more than expected in September, while production hit its highest level since January, bolstering optimism over the U.S. economic outlook, industry data showed on Friday.
In a report, the Institute for Supply Management (ISM) said its Chicago purchasing managers’ index increased by 2.7 points to a seasonally adjusted 54.2 this month from a reading of 51.5 in August. Analysts had expected the index to increase 0.5 points to 52.0 in September.
On the index, a number above 50.0 indicates an expansion, while below indicates contraction.
MNI Indicators which helps elaborate the report said that the latest increase was driven by a sharp gain in Production, which rose 7.3 points to 59.8, the highest since January 2016.
New Orders and Order Backlogs, which led the barometer’s decline last month, were little changed in September, with the latter failing to bounce back above the 50 breakeven level.
Employment was the only barometer component that fell, having rallied to a 16-month high in August.
“Economic growth in the US appears to have picked up a little at the end of the third quarter and although the Employment component fell, this was on the back of a relatively strong showing in the previous month,” said Lorena Castellanos, senior economist at MNI Indicators.
After the report, EUR/USD was trading at 1.1213 from around 1.1212 ahead of the release of the data, GBP/USD was at 1.2986 from 1.2992 earlier, while USD/JPY was at 101.23 from 101.22 earlier.
The US dollar index, which tracks the greenback against a basket of six major rivals, was at 95.45 from 95.44 previously.
Meanwhile, U.S. stock markets were higher after the open. The Dow 30 gained 0.55%, the S&P 500 rose 0.42%, while the Nasdaq Composite traded up 0.28%.
Elsewhere, in the commodities market, gold futures traded at $1,325.50 a troy ounce, compared to $1,329.65 ahead of the data, while crude oil traded at $47.91 a barrel from $47.92 earlier.