UK manufacturing activity slows in March
The Chartered Institute of Purchasing and Supply (CIPS)/Markit manufacturing purchasing managers’ index (PMI) has today revealed UK manufacturing activity slowed more than expected in March.
The closely-watched CIPS/Markit manufacturing PMI dropped to 57.1 in March – a five-month low – down from a revised 60.9 in February.
The reading was much lower than the 60.5 expected by analysts.
However, the index continues to stay above the crucial 50 mark, which indicates expansion, where it has been for 20 consecutive months.
Commenting on the data, David Noble, chief executive at the Chartered Institute of Purchasing & Supply, said: “The mini boom in U.K. manufacturing ran out of steam during March as faltering domestic consumer confidence, inflationary pressure and supply-chain disruption combined to slow down expansion.”
The manufacturing sector, which accounts for around 13% of economic output, has been one of the bright spots in the UK economy, which suffered a shock contraction in the fourth quarter of 2010.
Last month’s slowdown in the sector suggests the Bank of England will delay lifting interest rates until the economic recovery is secure – despite soaring inflation.
Construction activity and service sector activity figures will be published next week.