United Kingdom: Composite PMI rises to eight-month high in February
The IHS Markit/CIPS Flash Composite Purchasing Managers’ Index (PMI) rose to 60.2 in February, up steeply from January’s 54.2. February’s result marked the highest reading since June 2021. As such, the index moved further above the 50-threshold, pointing to a faster improvement in business conditions than the previous month.
The Manufacturing PMI came in at 57.3 in February, matching January’s print. While, output volumes rose at the fastest rate in seven months, severe pressure on supply chains and staff absences due to Covid-19 infections weighed on the overall figure. Meanwhile the Services PMI rose to 60.8 in February (January: 54.1) amid strong new order growth. On the price front, input cost inflation surged, leading to a further steep increasing in output costs.
Regarding the near-term outlook, Chris Williamson, chief business economist at IHS Markit, commented:
“The indications of a growing plight for manufacturers will need to be watched, and the service sector’s new business index will need to be monitored for signs of the demand revival losing steam. Given the rising cost of living, higher energy prices and increased uncertainty caused by the escalating crisis in Ukraine, downside risks to the demand outlook have risen.”