UK manufacturing data below expectations

| April 3, 2006 | 0 Comments

While manufacturing in the UK was at its slowest pace in over half a year in March, producers passed their costs on to consumers at a higher rate during the month., according to new data released Monday in the CIPS/RBS Purchasing Managers’ Index. The slowdown in the growth of output came across the board rather than focusing in one sector.

The PMI came in at 50.8 for March, compared to a newly revised figure of 51.5 in February. The March figure was lower than had been expected. With a level above 50 indicating an expansion in manufacturing and a figure below 50 indicating a contraction of manufacturing activity, the March figures show that activity is still expanding, but just barely.

However, the survey also showed that the output prices index was at 55.1 in March, an increase from 54.1 in February. This was the fastest prices had risen in a little over a year and was the eighth month in a row that factory gate prices have increased. Even so, it appears that manufacturers are not passing on all their price increases to the consumer, with the input prices index at 64.5 in March, even though this figure was slightly lower than February’s 65.7.

Other data included in the report show that the export orders index was very low, at 50.3 for March, but above the February level of 50.1. The survey showed, as well, that March was the twelfth consecutive month that the number of workers employed in manufacturing in the UK fell, even though the drop in workers slowed slightly during the month.

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