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The UK manufacturing sector remained in contraction in February, according to survey data on Wednesday, though production rose for the first time in eight months.
The S&P Global/CIPS UK manufacturing purchasing managers’ index rose to 49.3 points in February from 47.0 in January. This was slightly ahead of a previous flash estimate of 49.2.
The reading stayed below the 50-point mark that separates growth from contraction for the seventh month in a row. However, it was the best reading during that period.
Production in manufacturing improved for the first time in eight months, with signs of improving client demand, and new orders rising in consumer and investment goods.
It was also boosted by weaker cost inflation and reduced supply chain disruption.
‘Input prices increased at the slowest pace since July 2020 and supplier performance improved for the first time in three-and-a-half years. This offset some of the ongoing negative impacts from strikes, the cost of living crisis and lower order intakes,’ said Rob Dobson, S&P Global Market Intelligence director.
Intermediate foods producers saw the downturn continue, though the rate of output and new business declines eased from previous months.
Overall confidence among manufacturers strengthened during February, with a majority of companies anticipating an expansion of production in the coming year.
‘Manufacturers benefited from growing signs of a global economic recovery and the easing of Covid restrictions by China. This process of economic revival, alongside signs of inflation peaking and reduced recession fears, should hopefully help UK manufacturers eke out further growth in the coming months,’ Dobson added.
The UK manufacturing PMI is compiled by S&P Global from responses to surveys sent to around 650 British manufacturing firms, with the data collected between February 10 and 23.
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