UK Manufacturing Downturn Continues as New Orders Dwindle Amid Market Uncertainty

2 months ago 13

The UK’s manufacturing assemblage has been tipped into a 3rd monthly contraction arsenic caller bid intakes decline, an influential survey has found.

The S&P Global/CIPS UK Manufacturing PMI scored 48.4 successful September, a flimsy betterment from 47.3 successful August, a 27-month low. Anything beneath 50 is considered to amusement that the assemblage is shrinking.

Although the complaint of contraction successful output eased somewhat since the erstwhile month, it nevertheless remained important overall, S&P Global said successful its latest report.

Manufacturing companies chopped backmost connected accumulation successful effect to declining caller bid intakes. Some expected orders were postponed oregon cancelled, owed to factors specified arsenic rising uncertainty, inflationary pressure, and the cost-of-living crisis, the study said.

Compared with the home market, firms faced adjacent tougher conditions successful export markets. September saw caller export concern declaration astatine the quickest gait since May 2020, with reports of little request from the United States, the EU, and China.

Manufacturers faced anemic planetary marketplace conditions, rising uncertainty, precocious proscription costs reducing competitiveness, and longer pb times partially caused by Brexit-related paperwork, starring to an summation successful cancelled orders, said S&P Global.

“Manufacturing businesses continued to consciousness an autumnal chill successful September arsenic declining sales, higher costs, and a depressed marketplace pulled the assemblage down into contraction for a 3rd period successful a row,” said John Glen, main economist astatine the Chartered Institute of Procurement & Supply (CIPS).

“Supply concatenation managers were buying little arsenic customers either failed to spot orders oregon cancelled enactment successful hand.”

Inflation Bites

Meanwhile, the rates of inflation for input costs and output charges person some been accelerating.

In caller months, British businesses and households person been wrestling with rising vigor costs, a leap successful borrowing costs, and a volatile currency which struck a grounds debased against the U.S. dollar connected Sept. 26.

While successful mentation a anemic lb should boost request for British exports by making them cheaper for overseas buyers, it besides raises the outgo of imports of substance and earthy materials, which are often priced successful dollars.

Rob Dobson, manager astatine S&P Global Market Intelligence, said, “Disappointingly, exports proceed to autumn contempt the much competitory speech rate.”

“There was besides little affirmative quality connected the terms front, with rates of ostentation successful input costs and selling prices some picking up successful September, linked successful portion to import costs rising owed to the weaker pound,” helium added.

PA Media and Reuters contributed to this report.

Alexander Zhang