Export market drives UK manufacturing growth: Markit
A growing export market helped boost the UK’s manufacturing industry in October, according to Markit Group’s monthly PMI report. Export orders accelerated at the fastest pace in more than two years, giving the manufacturing industry a solid start to the fourth quarter.
The October reading fell 0.3 points to 56.0. A reading above 50 indicates manufacturing activity is expanding, whereas a reading below the 50 mark signals a contraction. Manufacturing PMI is closely monitored by the financial markets because manufacturing activity is an important contributor to national gross domestic product.
The rate of output growth fell to its lowest level in three months, but growth in new orders and improved market conditions kept manufacturers on firm footing. Improvements in new orders and output were reported across all nine of the industry categories. Employment rose for the sixth consecutive month, as manufacturers increased their staffing to account for new business orders. The rate of job growth eased from September, where job creation hit a 27-month high.
“British manufacturers swept into Q4 with a steady wind behind them, bolstered by strengthening markets both at home and abroad, as well as output growth across the consumer, investment and intermediate industries,” said David Noble of the Chartered Institute of Purchasing & Supply.
Manufacturers helped the British economy accelerate at the fastest pace in over three years last quarter. Gross domestic product grew 0.8 percent between July and September, according to the UK’s Office for National Statistics. October PMI shows manufacturers are carrying their momentum forward into the fourth quarter.
“The UK is no longer being left behind in the chase to benefit from improving global markets,” said Markit Group economist Rob Dobson. Although the UK is still in its early stages of recovery, three consecutive quarters of positive growth signals the once mighty growth engine is no longer susceptible to the same pressures that brought about its worst recession in a century.
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