UK PMI Manufacturing recovered to 48.3 in September, up from 47.4 and beat expectation of 47.0. However, Markit noted that downturn continues as rate of jobless accelerated to the worst level since February 2013. New orders and output also fell further. But purchasing and input stocks rose as Brexit preparations restarted.
Rob Dobson, Director at IHS Markit, which compiles the survey:
“The UK manufacturing downturn continued in September, adding to signs that the sector may be sliding into recession. Output, new orders and employment all fell further as rising political, trade and economic uncertainties exacerbated concerns about Brexit.
“Some manufacturers noted increased inventory building activity in preparation for the forthcoming exit date, but the impact of such Brexit-related stock building was dwarfed by weakening demand for other customers, due in part to clients routing supply chains away from the UK.
“The rate of job losses accelerated to a six-and-a-half- year high, highlighting how manufacturers are increasingly seeking to cut costs. Similarly, the investment goods sector was especially hard hit in September, seeing the sharpest drops in production and new business, as clients reined in capital spending while conditions remained volatile.
“The shroud of uncertainty also weighed on manufacturers’ confidence, which remained at one of its lowest ebbs in the survey history. These headwinds all ensure that manufacturing will likely remain a drag on UK economic growth during the months ahead.”
