September 2, 2014
The Guardian reported that the UK manufacturing sector hit a 14-moth low in August, with a PMI level of 52.5 – down from 54.8 in July and below previous forecasts in a Reuters poll.
Despite the PMI being above 50, indicating that the sector is still seeing growth, it was reported that “the onus will fall on consumers to keep driving the UK’s economic upturn” in the final half of the year; with the slower rate attributed to the new orders component dropping to its lowest level since April last year at 52.9 – down from 56.8 in July. This was reportedly the “biggest one-month drop for two years”, with factories hiring staff “at the slowest pace” since June 2013.
The UK’s PMI level reflected that of Eurozone manufacturers, which also indicated that growth had “eased more than expected”; while the EEF – the UK’s main manufacturing trade body – cutting its growth forecast for 2014 following members reporting “a big drop in export orders”.
Rob Dobson, Senior Economist at Markit, commented: “It is becoming increasingly evident that UK industry is not immune to the impacts of rising geopolitical and global market uncertainty […] that’s especially true when they affect economic growth and business confidence in our largest trading partner, the Eurozone.”
However, Dobson noted that the pace of the UK manufacturing sector’s expansion “remained slightly above its long-term average” despite “consumer, intermediate and investment goods producers” seeing a “slowdown”.
Markit noted that employment within the UK manufacturing sector “increased overall, mainly due to hiring from small to medium-sized manufacturers”, but “staffing levels fell at big firms”; while “price pressures continued to look muted” as the MPI showed that “factory gate prices grew at the weakest pace since March”.
The Recycler reported that the UK manufacturing sector ended 2013 with strong growth, as output growth was set to reach over one percent for the final quarter of the year. It was also reported that November 2013 saw the highest PMI level recorded for three years, reaching 58.1.
Categories : City News