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UK manufacturing PMI dips, but output growth accelerates in July
The July PMI stayed above 50 for a ninth straight month, while input cost inflation slowed to a five-month low as supply-chain delays eased.
The UK manufacturing sector lost some momentum in July, with the final S&P Global Manufacturing PMI easing to 51.9 from 52.5 in June, the lowest reading in four months. The index still remained above the 50 expansion threshold for a ninth consecutive month, pointing to continued growth despite slower improvement.
S&P Global data also showed a more positive undercurrent than the headline suggested. Manufacturing output rose for a fourth straight month, and production growth accelerated to its fastest pace in nearly two years as stronger market conditions supported new orders and export demand.
Among the components, four of five indicated improving operating conditions, while the headline decline was linked to a sharp reduction in stocks of purchases, slower hiring, and a smaller deterioration in supplier delivery times. Growth was uneven, with medium and large manufacturers outperforming smaller firms, where production declined modestly.
S&P Global also cited improving supply and cost conditions, with input cost inflation slowing to a five-month low as supply-chain delays eased to their weakest level since the start of the Middle East conflict. Although hiring growth nearly stalled, backlogs of work rose for the first increase in more than four years, while business confidence remained subdued amid geopolitical developments, global trade tensions, and the new UK government’s industrial and tax policies, Action Forex said.