The UK manufacturing sector showed tentative “signs of stabilization” in June, with PMI Manufacturing index finalized at 47.7, its highest in five months.
While the reading remains in contractionary territory, the pace of decline in production, new orders, and employment all slowed. Business optimism improved to a four-month high, and the orders-to-inventory ratio — a key forward-looking indicator — surged to its strongest level since August 2024, raising hopes of a potential rebound in output.
Rob Dobson, Director at S&P Global Market Intelligence, noted that inflationary pressures are also easing, with both input costs and selling prices rising at slower rates. However, he warned that any recovery remains vulnerable to multiple external risks. These include ongoing geopolitical tensions, global demand weakness, tariff-related uncertainties, and domestic political shifts.
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