The UK Markit/CIPS Purchasing Managers’ Index® (PMI®) for the manufacturing sector in the UK dipped this month amid concerns that the UK may be going into a double-dip recession, the first since 1975.
The figure of 50.5, has fallen from the previous month’s 51.9 but is still in growth territory for the fifth month in a row. Weaker overseas demand has affected new orders.
David Noble, Chief Executive Officer at the Chartered Institute of Purchasing & Supply:
“A sharp decline in export demand has led to a slowdown in UK manufacturing growth, placing the sector in a more delicate position compared to the start of the year. Although still in positive territory, manufacturers reported a slowdown in activity, characteristic of continued problems and poorer consumer confidence across the Eurozone. The easing of new orders from the US and Asia, is perhaps even more worrying as a potential risk to continued growth, as these have helped to balance out weaker demand in recent months.
“Despite tougher conditions overall, some companies were still able to increase headcount this month, courtesy of increased output and new product lines. The health of order books during the next few months will be the critical factor if overall employment levels are to stay on an even keel.
“On a more positive note, this month’s slower increase in input prices is likely to offer some relief, with many manufacturers being forced to respond to last month’s rising oil prices by passing on costs at the highest rate for seven months despite increased market competition.”
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