UK manufacturing growth slows as demand weakens
UK manufacturing growth fell to a near three-year low in February following a slowdown in new orders, new figures show.
The latest Markit/CIPS manufacturing Purchasing Managers' Index (PMI) fell to 50.8 last month. A figure above 50 indicates growth, but the figure was the lowest reading since April 2013 and below 52.9 in January. Output slowed sharply after levels of new business failed to increase from the numbers recorded in January. Exports shrank for a second consecutive month, with orders down in mainland Europe, the US, Brazil and Russia. "The near-stagnation of manufacturing highlights the ongoing fragility of the economic recovery at the start of the year and provides further cover for the Bank of England's increasingly dovish stance," said Rob Dobson, a senior economist at Markit. "The breadth of the slowdown is especially worrisome. The domestic market is showing signs of weakening while export business continued to fall." UK manufacturing has been under pressure for a number of months, hampered by a slowdown in demand from major overseas economies. Recent figures from the Office for National Statistics indicated that the manufacturing sector dragged on UK economic growth during the final three months of 2015, with the economy dependant on the service sector and consumer spending. The information for February's PMI survey was compiled before the recent fall in sterling against the dollar, which sent the pound to a seven-year low of $1.3876. Sterling is currently trading at close to $1.40. A weak pound makes goods cheaper for overseas customers looking to buy British goods but it also means that imports and manufacturing materials become more expensive for UK companies.