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Economic News

UK manufacturing weakens for 17th straight month, PMI data shows

By Benjamin Chiou

Date: Tuesday 02 Jan 2024

LONDON (ShareCast) - (Sharecast News) - The downturn in UK manufacturing output worsened in December, with the S&P Global purchasing managers' index (PMI) falling further into negative territory.
The final figure for December's PMI was revised to 46.2, down from the 'flash' estimate of 46.4, and comes after a seven-month high of 47.2 in November. Economists had expected there to be no change on the initial estimate.

Another negative reading - indicated by any figure below 50 - marks the 17th straight month below the neutral level for the manufacturing PMI.

All five of the PMI sub-indices - new orders, output, employment, stocks of purchases and suppliers' delivery times - remained below 50 last month.

Intakes of new work from both domestic and export clients declined, S&P Global said, while overstocking at clients and tighter inventory policies at manufacturers contributed to the overall decline in output.

Commenting on the results, Rob Dobson, director at S&P Global Market Intelligence, said: "With concerns about high interest rates and the cost-of-living crisis hurting demand, the outlook for manufacturers in the months ahead remains decidedly gloomy.

"The downturn in demand is having some positive effects on supply chains, however, with suppliers reducing their prices for raw materials and vendor lead times showing a further improvement."

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