The U.S. Purchasing Managers' Index (PMI) survey for March indicated a moderate growth of manufacturing sector's output, according to data released by the IHS Markit on Monday.

The seasonally adjusted IHS Markit final U.S. Manufacturing PMI posted 52.4 in March, down from 53.0 in February, and broadly in line with the "flash" figure of 52.5.

The first quarter average of 2019 was the lowest since the third quarter of 2017, and a key factor behind the lower headline figure was a slower rise in output.

U.S. manufacturers signaled a softer expansion of production in March, and the pace of increase was the slowest since June 2016, which firms partly attributed to softer client demand. Small, medium and large-sized firms all registered weaker rises in output.

Chris Williamson, chief business economist at IHS Markit, said that the March survey is consistent with production falling at a quarterly rate of 0.6 percent according to historical comparisons with official data.

"A further deterioration in the manufacturing PMI suggests the factory sector is acting as an increasing drag on the U.S. economy," he said.

According to Williamson, some positive signals showed that hiring remained encouragingly solid in March and expectations of future output perked up, but "things may well get worse before they get better."

He said that the ratio of new orders to existing inventory has fallen to its lowest since June 2017, suggesting the production trend may weaken further in April.

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