United Kingdom: Services and manufacturing PMIs soar in April
The IHS Markit/CIPS UK services Purchasing Managers Index (PMI) rose from 56.3 in March to 60.1 in April, an over six-year high. The improvement was driven by the loosening of government restrictions on consumer services, which drove demand and led to the strongest pace of job creation in several years.
Meanwhile, the manufacturing PMI rose from 58.9 in March to 60.7 in April, a multi-decade high, amid an acceleration in production growth. However, the reading continued to be flattered by rising delivery times artificially boosting the headline reading, amid Covid-19 related supply issues and trade frictions due to Brexit. Moreover, exports remained subdued in April, despite returning to growth, likely due to post-Brexit trading conditions.
Chris Williamson, chief business economist at IHS Markit, was upbeat on the near-term outlook:
“Companies are reporting a surge in demand for both goods and services as the economy opens up from lockdowns and the encouraging vaccine roll-out adds to a brighter outlook. In more than 23 years of PMI history, we have only seen one spell of faster growth than this, recorded between August and November 2013. Business activity should continue to grow strongly in May and June as virus restrictions are eased further, setting the scene for a bumper second quarter for the economy.”