The U.S. Purchasing Managers' Index (PMI) survey for January improved thanks to faster expansions in output and new orders, according to data released by the IHS Markit on Friday.

The seasonally adjusted IHS Markit final U.S. Manufacturing PMI posted 54.9 in January, up from 53.8 in December. The latest headline figure signaled a strong and faster improvement in the overall health of the sector.

Supporting the higher PMI reading was a sharp and quicker expansion in production across the manufacturing sector in January.

Meanwhile, upward price pressures across the manufacturing sector remained in January due to tariffs on steel and aluminum, alongside greater demand for inputs.

Chris Williamson, chief business economist at IHS Markit, said "January saw U.S. manufacturers start the year with renewed vigor. Production rose at a markedly increased rate, commensurate with the factory sector contributing to robust economic growth of approximately 2.5 percent in the first quarter if such momentum can be sustained in coming months."

He said that the upturn in business activity in January helped lift confidence in the outlook, "though many companies clearly remain concerned about the impact of trade wars and rising protectionism."

IHS Markit is a global company in critical information, analytics and solutions for the major industries and markets that drive economies worldwide. Enditem