Manufacturers get boost from robust UK sales
Data released yesterday pointed to a strong end-of-year run in the manufacturing industry, helped by the strength of the UK economy.
A survey of private sector firms called the purchasing managers’ index (PMI) shows manufacturing growth speeding up in November.
The survey results were released by financial information services firm Markit yesterday.
The manufacturing PMI for November scored 53.5 which – being above 50 – signifies expansion and marks a four-month high.
Output, new orders and employment all saw increases in November.
Manufacturing PMIs for the Eurozone were also released by Markit yesterday. The Eurozone PMI fell to 50.1 implying the manufacturing sector is stagnating as it was close to 50. The figure is a drop from October’s 50.6.
Worrying signals appeared in the country breakdown. Germany, Italy and France – the three largest Eurozone members – all registered a PMI consistent with a contraction in the manufacturing sector. The news adds further pessimism to the economic growth prospects of the currency union. Especially troublesome was Germany’s PMI, which edged down to a 17-month low of 49.5.
Robust domestic sales outweighed the Eurozone export drag.
“The news on the domestic front was especially positive, with solid new order inflows from the UK market the main pillar supporting the expansion. However, manufacturers reported subdued growth in export orders,” said economist Rob Dobson from Markit.
The figures come after survey results published yesterday by consultants BDO and manufacturing industry body EEF told the same story of a buoyant domestic economy more than offsetting a weak export market.
“Despite more disappointing results in key markets such as the Eurozone, this year should be the strongest year for industry since 2010,” said Lee Hopley, chief economist at EEF.