UK manufacturing sector remain relatively subdued...
UK manufacturing sector remain relatively subdued, according to the latest Markit/CIPS Survey.
Key points:
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UK Manufacturing PMI endged higher at 51.9, but remains below the average for the current sequence of growth
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Solid domestic market offset ongoing weakness in export orders
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Selling prices rise at fastest pace since August 2014
The start of the third quarter saw conditions in the UK manufacturing sector remain relatively subdued. Although the headline seasonally adjusted Markit/CIPS Purchasing Manager’s Index®(PMI®) edged higher to 51.9 in July, from a 26-month low of 51.4 in June, it remained below the average for the current sequence of growth that began in April 2013 (54.3).
The expansion of production remained highly dependent on the strong performance of the consumer goods sector, which offset lacklustre growth at intermediate goods producers and a contraction in the investment goods sector.
Where an increase in output was recorded, this generally reflected improved inflows of new business. However, the rate of growth in new orders slowed to a ten-month low, as solid demand from the domestic market contrasted with a further decrease in new export business.
New export orders declined for the fourth straight month in July, mainly as a result of the sterling-euro exchange rate hitting competitiveness in eurozone markets. Levels of new work from overseas were lower in the intermediate and investment goods sectors, but rose solidly at consumer goods producers.
Manufacturing employment rose for the twentyseventh successive month in July. Although the rate of jobs growth ticked higher, it remained below the average for the current sequence of rising headcounts. Where an increase in employment was reported, this reflected the ongoing upturn in new orders and efforts to clear backlogs of work. See the Markit/CIPS report summary for July on CIPS News.