Home / Day: July 1, 2022
Key findings
Output growth slows to near-stagnation pace……as new order intakes fall for the first timesince January 2021Price inflation remains elevated despitefurther easing
The slowdown in the UK manufacturing sector continued atthe end of the second quarter, as June saw output growthgrind to a near-standstill pace and new orders contract forthe first time in 17 months. Business optimism dipped to itslowest since May 2020, as the number of firms expectingproduction to rise over the coming year fell to 47% (from 55%in May).The seasonally adjusted S&P Global / CIPS UK ManufacturingPurchasing Managers’ Index® (PMI®) fell to a two-year lowof 52.8 in June, down from 54.6 in May. The PMI has remainedabove the 50.0 mark since June 2020.Manufacturing production rose for the twenty-fifthconsecutive month in June. However, the rate of expansionwas the weakest during the current upturn. Performancesdiffered widely across the sector. Consumer goods producerssaw a marked downturn in output, while robust expansionwas again registered in the investment goods industry.June saw intakes of new work decline for the first timesince January 2021. Companies indicated that the weakereconomic outlook, reduced new export order intakes, slowergrowth of domestic demand, the war in Ukraine, raw materialshortages and the slowdown in China all contributed to thereduction in new work received.The consumer goods and intermediate goods sectors werehardest hit by the decline in new order inflows. In contrast,investment goods producers saw new work rise for the fifthmonth running.New export orders contracted for the fifth month runningin June, mainly reflecting the slowdown in China, risingeconomic uncertainty, the war in Ukraine and increasedcompetition. Some firms also noted that ongoing Brexitrelated difficulties and weaker growth had impacted neworder intakes from the EU. New export business declined inthe consumer and intermediate goods industries, and wasunchanged in the investment goods category
source : spglobal.com