Slowdown in manufacturing growth 'an anomaly'

1 June 2011

1 June 2011 | Lindsay Clark

The UK manufacturing sector grew at its slowest rate since September 2009 in May.

The Markit/CIPS UK Purchasing Managers’ Index (PMI) for manufacturing recorded a figure of 52.1, a fall from a downwardly revised figure of 54.4 in April.

While the figure remained above the 50 mark that indicates expansion for the 22nd successive month, it was the lowest figure since September 2009.

Rob Dobson, senior economist at Markit and author of the PMI report, said domestic market weakness was the main drag on order books and output. “However, this was exacerbated by the additional bank holidays in late April, which fell during the early part of the latest survey period, and ongoing supply chain disruption following the Japanese earthquake. Consumer goods producers and small-scale manufacturers have been hit hardest by the slowdown.”

David Noble, CIPS CEO, said the picture might not be as disheartening in the coming months. “With the level of export orders still rising and the rate of inflation easing somewhat, we expect that May will come to be seen as an anomaly. However, the underlying trend is likely to remain one of slower growth compared with the start of the year."

Meanwhile, buyers in manufacturing firms saw input price inflation continue to ease. It fell from 75.7 in April to 71.3 in May, with both figures seasonally adjusted.

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