British manufacturing sector continues to grow in October

Time: 2017-11-03
Summary: British manufacturing sector continues to grow in October
British manufacturing sector continues to grow in October

The British manufacturing sector continued its run of robust growth in October, benefiting from improved economic conditions globally.

The Markit/CIPS purchasing managers' index (PMI) for October rose from September's 56.0 to 56.3, continuing an unbroken 15-month run of growth.

Markets and experts had expected a slight decline to 55.9, and the PMI figure released on Wednesday is above the long-term trend for this set of data.

Production and new order volumes continued to rise at robust rates, as companies benefited from rising inflows of new export business and strong domestic market conditions. The new orders index rose to 57.7 from 56.6 in September.

The domestic market was the prime source of new contract wins, although new export business also continued its history of growth.

Samuel Tombs, chief UK economist with data analysis firm Pantheon Macroeconomics, told Xinhua: "Developed economies are seeing a rebound in global trade flows and the UK is benefiting from that, being quite an open economy."

Companies saw improved intakes of new work from clients in the USA, mainland Europe, South America and Australia, in some cases aided by the sterling exchange rate.

Sterling has fallen substantially since the Brexit referendum vote, dropping from 1.48 U.S. dollars to 1.33 U.S. dollars on Wednesday.

"Sterling has weakened a lot in the last couple of years and that has now filtered through to the manufacturing sector," said Tombs.

However, the figures reveal a mixed benefit, with the sector growing because of global conditions but still lagging the growth of other developed economies.

Tombs said: "If you look at the UK's manufacturing sector compared to the eurozone, it is lagging behind, because of a slowdown in UK economic growth."

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