United Kingdom: Manufacturing PMI inches down in August
September 1, 2015
The manufacturing Markit/CIPS Purchasing Managers’ Index (PMI) inched down from 51.9 in July to 51.5 in August. Despite the decrease, the index remains firmly entrenched above the 50-threshold that separates expansion from contraction in business conditions. The index has been in positive territory since February 2013.
According to Markit/CIPS, August’s result came on the back of a modest increase in manufacturing output. Moreover, new orders also grew because of a strong domestic market. On the cost front in August, purchase prices dropped at the steepest rate in 16 years, reflecting a combination of lower oil prices, a strong sterling and a reduction in the cost of a wide range of raw materials. Markit/CIPS added that, “the sector was on a go slow trajectory this month, showing a disappointingly slow pace of growth, and barely moving from last month’s figure, raising fears this could be an entrenched situation developing in the next few months.”
Author: Dirina Mançellari, Senior Economist