2nd February 2015
UK manufacturing has enjoyed a strong start to 2015 as output growth and new orders have rebounded following a slowdown during the latter half of last year.
The widely followed Markit/CIPS Purchasing Managers’ Index (PMI), rose to 53 in January, up from 52.7 in December. A measure above 50 indicates growth and in the UK the headline PMI has remained above the neutral mark each month since April 2013.
The latest analysis found that the domestic market remained the prime driver of improved new order inflows. Solid output growth was registered at both intermediate and investment goods producers. However, the rate of growth in consumer goods output ground to a near standstill pace.
There was also a modest increase in new business from overseas, representing the first meaningful improvement in new export order volumes registered for five months. Companies reported increased demand from France, Germany, Japan, the Middle East, Poland and the USA.
Rob Dobson, senior economist at Markit said: “UK factories reported a welcome upturn in growth of output and order books at the start of the year, but producers clearly remain stuck in a low gear. The rate of expansion remains muted, however, with output rising at a quarterly pace of around 0.2% in January, barely improving on the 0.1% registered in the final quarter of last year. At this rate, the sector will provide little meaningful boost to the economy in the first quarter.”