Markit Economics released its final manufacturing purchasing managers' index (PMI) for the U.S. on Monday. The U.S. final manufacturing purchasing managers' index (PMI) decreased to 51.2 in December from 52.8 in November, down from the previous estimate of 51.3. It was the lowest level since October 2012.
A reading above 50 indicates expansion in economic activity.
The index was driven by a slower pace of growth in output and new business, while input costs fell.
"The strong dollar is hurting exporters as well as hitting domestic sales as firms compete against inflows of cheap imports. Low oil prices are meanwhile hitting demand for goods and machinery from the energy sector. There are signs that consumers are becoming more cautious in relation to spending as interest rates lift off their historic lows, and overseas demand remains in the doldrums. All of these factors look set to continue to hurt manufacturers, and even intensify, in coming months," Markit's Chief Economist Chris Williamson said.