UK manufacturing activity rose to an eight month high in March, according to the latest Purchasing Managers’ Index.
The Markit/CIPS Purchasing Manager’s Index for Manufacturing recorded a figure of 54.4 last month, an increase on the 54 posted in February. A reading above 50 indicates expansion.
The sector’s growth was attributed to the fastest rise in new business seen since July 2014, with the domestic market the biggest source of new contracts. There was also a slight rise in orders from overseas.
The consumer goods sub-sector was the strongest performer, with production increasing at the fastest pace since April 2014. Manufacturers also continued to create jobs, with employment rising for the 23rd month in a row.
“Scratching beneath the surface of the numbers we can see that the drivers of growth are heavily skewed towards domestic consumers, as consumer goods producers reported by far the steepest expansions of both production and new orders,” said Rob Dobson, senior economist at Markit.
David Noble, group CEO, CIPS: said suppliers were struggling to keep up with the pace of expansion in the sector.
“The manufacturing sector has provided further evidence that the UK economy is in rude health as the index continued to show positive growth, with a glut of new orders and with production ramping up,” he said.
“The bright spot continued to be lower input prices where manufacturers protected their margins by taking advantage of the fall in oil prices.”