Investing.com – Business activity in the U.S. private sector was higher than expected in December, rising optimism over the American economy, according to data released on Tuesday.
In a report, market research group IHS Markit said that its manufacturing purchasing managers’ index (PMI), rose to to 55.1 in December, from the prior reading of 55.0. It was the highest reading since March 2015.
On the indices, a reading above 50.0 indicates expansion, below indicates contraction.
Economists had estimated that it would remain flat at 55.0.
Chris Williamson, Chief Business Economist at IHS Markit, said businesses were expecting to be busier in the early months of 2018, while optimism about the coming year was at its highest in two years.
“The upbeat mood is underscored by an increased appetite to hire new staff, with the survey indicating that factory payroll numbers are rising at a rate not seen for over three years," he said. “Indicators of backlogs of work and input buying likewise suggest production will continue to grow at a solid pace as we move into 2018. However, the strengthening of demand for raw materials has led to supply chain delays, which have in turn been increasingly linked to higher prices as a sellers’ market develops."
After the report, the US dollar index, which tracks the greenback against a basket of six major rivals, traded at 91.65 compared to 91.64 before the report.
Meanwhile, U.S. stocks were trading higher after the open. The Dow 30 gained 127 points or 0.51%, the S&P 500 rose 13 points, or 0.49%, while the tech-heavy Nasdaq Composite traded up 44 points, or 0.64%.