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The downturn in the UK’s manufacturing sector continued in May, according to survey data on Thursday.
The seasonally adjusted S&P Global/CIPS UK manufacturing purchasing managers’ index fell to a four-month low of 47.1 in May, down from 47.8 in April.
Falling further below the 50-point mark that separates growth from contraction, it shows the deterioration has worsened slightly.
However, the final reading was better than the flash estimate of 46.9.
All of the PMI components, including output, new orders, employment, stocks of purchases and supplier lead times, signalled a deterioration in operating performance, S&P said.
Looking ahead, manufacturers’ outlook stayed positive in May, with 57% forecasting production would be higher in 12 months’ time and only 7% anticipating a contraction.
S&P said confidence was linked to new product launches, hopes for a more ‘conductive’ cost environment and a market recovery.
‘The UK manufacturing downturn deepened in May, with output, new orders and employment all falling at increased rates. Manufacturers are finding that any potential boost to production from improving supply chains is being completely negated by weak demand, client destocking and a general shift in spending in the UK away from goods to services,’ said Rob Dobson, Director at S&P Global Market Intelligence.
‘Although near-term conditions remain challenging overall, manufacturers are still finding reasons for
optimism including brighter news on the price and supply fronts. Average input costs fell for the first time in three and-a-half years, allowing some firms to maintain efforts to repair and protect margins damaged by a long and often severe period of cost inflation.’
The UK manufacturing PMI is compiled by S&P Global from responses to surveys sent to purchasing managers at around 650 UK manufacturers, with data collected between May 11 and 25.
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