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UK manufacturing sector activity edged higher on increased intakes of new business against a backdrop of rising price inflationary pressures, S&P Global said on Tuesday.
UK S&P Global-CIPS manufacturing purchasing managers' index was 55.8 points in April, up slightly from the preliminary estimate of 55.3 and the score of 55.2 registered in March.
S&P said the start of the second quarter saw a mild growth acceleration in the UK manufacturing sector. The rate of expansion in output improved from March's five-month low, leading to a further solid increase in staffing levels.
Further, S&P said manufacturing production increased across the consumer, intermediate and investment goods industries, while the expansion at consumer goods producers was only marginal.
S&P highlighted companies linked higher production to increased intakes of new business, reduced delivery delays - compared to earlier in the year - and efforts to clear backlogs of work.
However, S&P said Inflationary pressures continued to build as input costs rose at the second-strongest pace in the survey history. Around 85% of companies registered an increase in purchase prices, while there were no reports of a decrease. The rate of inflation at consumer goods producers hit a series-record high, it noted.
Rob Dobson, director at S&P Global, said: ‘The improved expansion of output at manufacturers, while positive in itself, failed to mask the continued headwinds buffeting the sector at the start of the second quarter. New business growth near-stalled as a slowdown in the domestic market was accompanied by a further deterioration in export orders.
‘Manufacturers and their clients are struggling as lockdowns in China and the Ukraine war exacerbate stretched global supply chains, the inflationary picture worsens and geopolitical tensions rise. Specific to the UK, Brexit represents an additional headwind, notably via lost EU customers, increased paperwork, customs checks and border delays. Business optimism has fallen to a 16-month low as companies become more cautious about the future outlook.’
The UK manufacturing PMI was compiled by S&P Global from responses to questionnaires sent to purchasing managers in a panel of around 650 manufacturers and was collected from 11 to 26 April.
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