A report from the Institute for Supply Management (ISM) showed the U.S. manufacturing sector expanded in March at a faster pace than in February. 

The ISM's index of manufacturing activity came in at 55.3 percent last month, up 1.1 percentage points from the February reading of 54.2 percent, exceeding economists' forecast for a 54.5 percent reading.

A reading above 50 percent indicates expansion, while a reading below 50 percent indicates contraction. 

The monthly gain by the headline index was primarily attributable to faster increases new orders (+1.9 percentage points m-o-m to 57.4 percent in March), production (+1.0 percentage point to 55.8 percent) and employment (+5.2 percentage points to 57.5 percent) indicators. Meanwhile, supplier deliveries index (-0.7 percentage point to 54.2 percent) and the inventories index (-1.6 percentage points to 51.8 percent) recorded decreases.

Timothy R. Fiore, Chair of the ISM Manufacturing Business Survey Committee said, “The past relationship between the PMI and the overall economy indicates that the PMI for March (55.3 percent) corresponds to a 3.7-percent increase in real gross domestic product (GDP) on an annualized basis.”