New orders continue to fall in manufacturing

30 April 2008
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01 May 2008 | Paul Snell

The number of new orders in the manufacturing sector fell for the fourth month in a row in April.

But overall activity in the sector continued to increase, although at a slower rate than the previous two months.

In April the CIPS/NTC Purchasing Managers' Index for manufacturing recorded a figure of 51, slightly above the 50-mark that indicates growth. In March the index recorded 52.1 and in February the figure was 53.1.

New orders remained below 50, recording 49.5 last month, a slight fall on the figure in March of 49.7. Domestic and foreign orders remained weak and strong competition from rivals and lacklustre demand from consumers contributed to its lowest reading for three years.

Although output increased in April, reaching 50.9, the report said this was achieved at the expense of work-in-hand, and production would weaken further in the coming months without a recovery.

Input costs, 78.5 last month, are now at their highest level for 13 years. In addition to higher prices for metals, chemicals, energy food and oil, the weakness of the pound against the euro contributed to a rise in the cost of goods from suppliers in Eastern Europe.

* Further coverage of PMI reports is available at http://www.supplymanagement.com/pmi



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